Turnaround management is the management process used to try and rescue a distressed or insolvent business. It uses analysis and planning to get to the root cause of the problems in order to determine why the business is failing.
Once the analysis is completed a strategic plan and a restructuring plan is put into place to try and turn things around. Once the plans are approved a business turnaround professional will begin to put the plan into action, and will work with the company until it becomes solvent.
The role of a Business Turnaround Specialist
A business turnaround specialist will be able to give you an objective view on your business situation and they may offer solutions that you have never considered before. Whilst this can be very distressing for you, business turnaround specialists are experts in this field and will have a wealth of experience. They can also often identify the root cause of the problems that your business is experiencing, whilst helping you obtain the injection of cash that you need.
A business turnaround specialist may perform the following tasks in order to get your business back on track:
- Examination of your management accounts and sales order book
- Creation of a business turnaround strategy, detailing timings, financial impact and methods of measurement to determine success
- Formulating a change management plan to deal with the likely resistance felt by many employees. Key staff members will clearly understand the turnaround plan and the consequences of not implementing the changes required
- Communication strategy to all staff to get buy in to the turnaround plan, this includes informing staff of job losses and reassuring remaining staff.
- Communicating with banks and lenders on the turnaround plans, and attempting to renegotiate terms
- Communicating to suppliers and renegotiating more favorable payment terms.
- Identifying assets which are not being used and liquidating them to provide extra cash, assessing overheads and limiting them where possible
Business funding options
As part of the turnaround management plan you may need to look at new ways of boosting your working capital.
The funding options can include:
- Invoice Financing, such as factoring which allows you to unlock the cash that is tied up in your unpaid invoices.
- Stock financing, enables a business to borrow money against the value of the stock they hold on their balance sheet.
- Asset financing, allows you to use your assets to secure a cash injection.
- Property financing, allows you to raise finance on your land and buildings.
To understand the whole range of options and to get help choosing the right one for your business contact us on 0800 597 4757 or enquire online using the form opposite.
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