Our Business Turnaround team assists businesses of all sizes in addressing poor performance. This involves reviewing strategic, operational, and financial issues that help to improve business performance.

 

Our services are specific to a client’s needs and may involve strategic assessment, process improvement, asset redeployment, cost realignment, performance benchmarking, interim management, tax structuring, or corporate finance advice.

 

Our services are delivered both to businesses seeking to accelerate growth as well as businesses facing financial difficulty and requiring immediate attention.

 

Advantages of Using Virtual Business Solutions for Company Rescue

 

We enter a business with a fresh eye and complete objectivity, and can often spot problems that may not be visible to company insiders.

 

We have no political agenda or other obligations to bias the decision-making process, allowing unpopular, yet necessary, steps required for survival.

Like an emergency room doctor, we can make critical decisions quickly to staunch the financial bleeding and give the business the best chance for recovery.

When it comes to dealing with angry creditors, frightened employees, wary customers, and a nervous board of directors, experience and expertise matters.

 

Signs of a Troubled Business

Most businesses in distress display more than one of these signs of trouble:

Ineffective Management Style. The business owner or founder often is reluctant to delegate authority or refuses to do so. No decision, big or small, can be made without this person's authority. As a result, the rest of the management staff gains no solid experience of the business. If the owner or founder suddenly becomes incapacitated or dies, the entire business is in danger of collapse due to the resulting leadership void.

 

Overdiversification. The business has yielded to pressure to diversify to reduce risk. However, too much diversification may cause a company to spread its managerial, financial, and competitive resources too thin. As a result, the business becomes vulnerable to loss of market share to better competition.

 

Weak Financial Function. A company with excessive debt and inadequate equity capital is operating with little or no margin for error. Credit is overextended, inventories are accumulating, and fixed assets are underutilised. The introduction of better working capital policies and improved capacity utilisation decisions are clearly warranted in such cases. Yet management instead often engages in debilitating attempts to grow the company out of its problems.

 

Poor Lender Relationships. A weakened financial condition has led to the company developing an adversarial and unproductive relationship with its lending institution(s). Fearing that its loan relationships and facilities may be in jeopardy, the company tries to conceal financial information from its lenders. Telephone calls from the bank are not returned. Interim or periodic reports are not filed. Since money is the lifeblood of any business, this kind of lender relationship only leads to more trouble and compounds the difficulty of managing the declining business operations.

 

 

Lack of Operating Controls. The company is operating without adequate reporting, accountability, and responsibility mechanisms. This is like flying an airplane without an instrument control panel. Management decisions based on inadequate, untimely, or inaccurate information can make a bad situation considerably worse.

 

Market Lag. Changes in the product and customer marketplace have bypassed the company, leaving it with sagging sales and declining market share. For some businesses, the source of the deficiency is technology; their equipment or products and services have become obsolete. For others, the problem lies in sales and marketing; the company hasn’t kept pace with the needs of the marketplace or the ability to distribute its products effectively to the customer base.

 

Explosive Growth. The business is growing rapidly. Companies achieving fast growth from concentrating on boosting sales often overlook the effects of that growth on the balance sheet and the cash requirements of funding it. Growth often carries a very high capital investment requirements, and leveraging a company to meet these increased funding needs typically means that management must operate with little or no margin for error.

 

Narrow Customer Base. The business relies on a few big customers for most of its sales. If a manufacturer selling to large retail chains has two customers representing 60 percent of its business, the company obviously is vulnerable to the financial condition of its customer or the possibility of new suppliers displacing its relationship. The loss of just one of these key customers could put hundreds out of work and send the business into bankruptcy.

 

Family vs. Business Matters. Family issues can cause business decisions to be made on an emotional basis rather than on sound business principles. Divorce can also shatter a business, leaving it in fragments.

 

Operating without a Business Plan. Armed with 15 or 20 years in the business, management often operates a growing company by intuition or the seat of its pants. Its plan may change overnight because it is based on management’s own "feel" for the market. In some cases, the business plan exists in everyone’s head rather than in writing. The result is that plans are carried out according to individual interpretation. Moreover, plans are inadequately communicated to employees.

 
We offer a confidential and free no obligation initial consultation to assess and advise you on possible options going forward. We operate nationwide and can meet with you at your convenience. Our cost structure is extremely competitive based on our low overheads.

 

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