A number of factors, such as responding to economic pressures, changes in the marketplace or product and service changes, can emerge which impact the financial and / or operational performance of a company.
If mitigating action is not taken quickly the company risks developing serious cash flow problems which can threaten its very existence. During these challenging times it can be difficult for directors to take rational, objective decisions as the focus tends to be on the reactive management of day-to-day issues.
Business restructuring can cover a multitude of areas, but it typically involves refocusing the financial and / or operational strategy in order to improve liquidity and performance. When a company is having trouble making payments on its debt, it will often consolidate and adjust the terms of the debt in a debt restructuring which increases its ability to repay more manageable sums. An operational restructure tends to streamline costs, such as payroll, or reduce its size through the sale of assets. This is often seen as necessary when the current situation at a company is one that may lead to its collapse.
Decisive and timely action, driven by an experienced advisor, can, therefore, be the important first step in successfully restructuring the business.
When to consider Business Restructuring & Recovery Advice
Undertaking a strategic review of performance makes good business sense at any time but it is especially useful in situations where a business, for whatever reason, has not achieved, or is not likely to achieve, its objectives. If there is an immediate or potential risk of not being able to pay creditors when debts fall due then urgent advice should be sought before things escalate.
SKSi will conduct an Independent Business Review which examines the processes, procedures, plans and performance of your business to identify strengths, weaknesses, opportunities and threats. We will then work with the business to develop an action plan aimed at building upon its strengths, embracing opportunities, addressing weaknesses and mitigating against the risks posed by identified threats.
Some of the most common areas where we can assist include cash flow management, controlling expenditure and risk management as well as improving operations, suggesting strategic sourcing strategies, and inventory management.
Keeping colleagues, staff, customers or clients and in some cases, media, informed of potential changes is a vital part of the process and we can provide advice on a suitable internal and external communications strategy to help ensure restructuring progresses as smoothly as possible.