Business restructuring and new solutions a consideration in tough times

With any business, no matter what its size, potentially facing a reversal of fortune, innovative thinking can be as important to your company’s survival as capital.

The business challenges of the past 12 months have brought into focus that any director or manager can be ‘too close to their own business’; so close in fact that they can lose perspective over time. It is understandable that people want to protect the business they have nurtured and built - so they may delay seeking the very assistance that can guide them through difficulty.  

Tim Drury, Principal at Private Broker Business Advisory, explains “in tough times, the ability for companies in financial crisis to restructure defensively and minimise loss is critical. Assessing your situation with a fresh pair of eyes, can for example, help find solutions for cash flow problems or for faster payment options.”

Dealing with liquidations, administrations and bankruptcies, Private Broker Business Advisory has a network of insolvency industry contacts.

As Drury explains “in a corporate restructure scenario, we can identify opportunities to increase profitability and stimulate growth. Where insolvency advice is required, we can provide protection and advice to companies and individuals when they face financial difficulties. In certain circumstances, financial support is available for companies experiencing difficulty and cash flow problems.”
 
Case Study 1
A construction company that employs 250 staff began to experience financial distress when trade debtors failed to make payments on time. This began a domino effect which eventually saw the company being placed into Voluntary Administration, as it was unable to pay its own debts on time.

Private Broker Business Advisory assisted the director with sourcing finance and negotiated with creditors via a Deed of Company Arrangement for an amount the company could afford. This strategy allowed the company to continue trading and to keep its experienced staff employed. 

Case Study 2
An exporting company with three directors found themselves in severe difficulty when one of the directors caused the company to be insolvent based on poor business decisions. This led to the company entering into Voluntary Administration to deal with legal and financial issues.

While the other two directors were not heavily involved in the day-to-day operations of the company, they were still held personally liable for company debts. This presented an issue, as those two directors owned personal assets including property.

Private Broker Business Advisory were able to assist those two directors to negotiate a suitable arrangement with the company’s Administrator, allowing them to settle all claims against them. 

The two directors were able to keep their properties and continue working in the same industry under a business model that provided them more autonomy.

Drury adds “industry sources indicate that the average lag-time between directors ‘knowing they’re in trouble’, and actually doing something about it can be 18 months.

“The first step is to talk with someone who can understand your circumstances and offer sound advice, and to do it in a timely manner.”

May we suggest that if you believe you have difficulty, that you make time to call us soon.

For more information contact Private Broker Business Advisory on 1300 855 076, E: info@privatebroker.com.au, www.privatebroker.com.au