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Interviewing for a Company in Financial Difficulties

Laura

Are there ever any circumstances where you would interview for a role where a company is making considerable turnover, but is making thousands of pounds loss for the last 2 years and defaulted on a bank loan?

To add a little context, the CEO was replaced at the back end of 2018 (after the accounts had been completed) and there seems to be lots of changes happening across the company, but cannot see how a business would survive in this way.

Any thoughts? I am planning on having the conversation with the employer to demonstrate my commercial awareness anyway, just wondering if it is worth my time.

L 

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  • Turnover is often a red herring - profit and long term route to profitability is key. Thomas Cook had really quite good revenue streams......thousands of pounds of losses isnt that unusual depending on the size of the company. 

    The default on the loan is the biggest concern for me. That leads often to reduced borrowing headroom and higher interest. Making it a vicious downwards spiral.

    But - if they have a route to sufficient working capital and a plan to get out of the mess they are in then the HR journey can be an amazing learning and growing experience (and can in some circumstances be financially rewarding). But only if you go into it with your eyes open, understand the real future strategy and have a reasonable approach to the risk of being out of a job without compensation.

    You also need to be ready for a job that maybe permanent firefighting, quite unpleasant and be able and ready to make some very tough decisions to help the business survive.

  • in reply to Keith
    Thanks Keith
    The loan looks fairly recent, which was the biggest concern, the fact that they are also a training company is a concern with all of the news surrounding apprenticeship companies 'going under'

    They are connected with a private equity company, who's finances also do not look great. The fear for me, is having no employment rights and being made redundant. This would be my first BP role, so just want to make sure that it is the right move, as they are said to be really keen to have me on board.
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  • in reply to Keith
    Thanks Keith
    The loan looks fairly recent, which was the biggest concern, the fact that they are also a training company is a concern with all of the news surrounding apprenticeship companies 'going under'

    They are connected with a private equity company, who's finances also do not look great. The fear for me, is having no employment rights and being made redundant. This would be my first BP role, so just want to make sure that it is the right move, as they are said to be really keen to have me on board.
Children
  • in reply to Laura
    A lot of private apprenticeship providers have struggled recently due to losing funding on the back of a poor inspection report - I'd want to know when the provider was last inspected, what the result was, when they expect their next inspection (although that's often down to an educated guess), how long they've been on the register of apprenticeship training providers and how reliant they are on ESFA funding in terms of their general finances.
    (Apologies if you already know all of this!)