How to properly close a business

The Covid-19 crisis negatively affected businesses around the world and a number of major companies – including Neiman Marcus, Dean & Deluca and True Religion Apparel – filed for bankruptcy.

A friend of mine who resigned from her job two years ago to start a creative agency is going through a closure process and feels devastated.

“It could’ve been something. Perhaps I can do it again one day,” she told me.

Many of us are thinking about our plans for the year ahead, and quitting a business to start something else may be one. Closing down your business is tough, and may make you feel like a failure. I know, because I have been in that situation. I started and managed my own online fashion business prior to joining the semi-government sector. My fashion business was doing well, but I was also focused on my day job, and on my growing consultancy, so I had no time to dedicate to the creativity and attention that the business required. Closing it down was the best decision I made then. I didn’t wait until my business was performing badly. I knew that it was something that I had to do given the rate at which my other commitments were growing, so I ripped off the Band-Aid fast.

So what is the right way to close a business? Here’s a simple guide on how to shut up shop and how to prepare for the next chapter.

Ask the experts

Before you go ahead and tell people your business is closing, seek the advice of an accountant and/or a lawyer on how to best conduct the process. This, of course, depends on so many factors such as whether you have investors, you took out a loan, or any settlements you need to make to creditors.

In my case, I self-funded my business, and I had already made some profit so the process was smooth and swift.

Depending on your business, you may have some payments due from your customers. It’s best to make sure you’ve received these before you inform them about your decision. Otherwise, some people may stall knowing that you are closing and think that they may not need to pay you.

Make some money on your way out

Depending on your line of business, you’d be surprised at how many things you are able to sell – from the business itself to IT equipment, products and even your web domain (especially if it’s a catchy one). An acquaintance of mine sold his web domain address for $1,000 when he closed his business. Other domains can sell for hundreds of thousands of dollars.

Keep your stakeholders in the loop

This is important for all businesses, but is crucial during tough times. If you are planning closure for some time, don’t wait until the end to tell your employees. While some business owners do this so that sensitive information isn’t leaked, there are ways to protect confidential information while keeping your employees in the loop. Be there for your team, and try to accommodate them as much as possible. Perhaps you could help refer them to your acquaintances, or share their resumes with friends. Offer quality customer service to the last day, share your news with customers and thank them for their support.

Reflect and move on

Quitting doesn’t mean the end of your journey. In the case of my friend, she’s taking time to reflect on everything that has happened, and the lessons she learned. She now knows that she wants to focus on a specific service, and to only offer it online when she jumps back on the wagon.

Quitting a business may be one of the hardest processes an entrepreneur has to endure, but it is one that is best done sooner rather than later.

Manar Al Hinai is an award-winning Emirati journalist and entrepreneur, who manages her marketing and communications company in Abu Dhabi

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Five hymns the crowds can join in

Papal Mass will begin at 10.30am at the Zayed Sports City Stadium on Tuesday

Some 17 hymns will be sung by a 120-strong UAE choir

Five hymns will be rehearsed with crowds on Tuesday morning before the Pope arrives at stadium

‘Christ be our Light’ as the entrance song

‘All that I am’ for the offertory or during the symbolic offering of gifts at the altar

‘Make me a Channel of your Peace’ and ‘Soul of my Saviour’ for the communion

‘Tell out my Soul’ as the final hymn after the blessings from the Pope

The choir will also sing the hymn ‘Legions of Heaven’ in Arabic as ‘Assakiroo Sama’

There are 15 Arabic speakers from Syria, Lebanon and Jordan in the choir that comprises residents from the Philippines, India, France, Italy, America, Netherlands, Armenia and Indonesia

The choir will be accompanied by a brass ensemble and an organ

They will practice for the first time at the stadium on the eve of the public mass on Monday evening

Keane on …

Liverpool’s Uefa Champions League bid: “They’re great. With the attacking force they have, for me, they’re certainly one of the favourites. You look at the teams left in it - they’re capable of scoring against anybody at any given time. Defensively they’ve been good, so I don’t see any reason why they couldn’t go on and win it.”

Mohamed Salah’s debut campaign at Anfield: “Unbelievable. He’s been phenomenal. You can name the front three, but for him on a personal level, he’s been unreal. He’s been great to watch and hopefully he can continue now until the end of the season - which I’m sure he will, because he’s been in fine form. He’s been incredible this season.”

Zlatan Ibrahimovic’s instant impact at former club LA Galaxy: “Brilliant. It’s been a great start for him and for the club. They were crying out for another big name there. They were lacking that, for the prestige of LA Galaxy. And now they have one of the finest stars. I hope they can go win something this year.”

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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If you go

The flights
There are various ways of getting to the southern Serengeti in Tanzania from the UAE. The exact route and airstrip depends on your overall trip itinerary and which camp you’re staying at.
Flydubai flies direct from Dubai to Kilimanjaro International Airport from Dh1,350 return, including taxes; this can be followed by a short flight from Kilimanjaro to the Serengeti with Coastal Aviation from about US$700 (Dh2,500) return, including taxes. Kenya Airways, Emirates and Etihad offer flights via Nairobi or Dar es Salaam.