Periods of financial difficulty are nothing new for many businesses. Rising costs, fluctuating customer demand, increasing competition, seasonality and cash flow issues are just a few common problems that can cause firms to struggle.
Over 25,000 companies across England and Wales went bust last year, representing a 30-year high. However, many of those could have been saved if they had obtained company turnaround and business recovery advice at the first sign of trouble.
Company turnaround and business recovery is the process of stabilising a struggling business and making sustained improvements and lasting changes that allow it to avoid collapse and return to profitability.
As long as your business’s underlying model is viable, company turnaround specialists can explore and implement various strategies to get it back on track. That includes everything from informal debt repayment arrangements, streamlining and alternative funding methods to formal insolvency procedures such as a Company Voluntary Arrangement (CVA) and Administration.
You can get initial advice from a variety of sources. Business Debtline, a charity run by the Money Advice Trust, offers free, independent advice for struggling companies. You can talk to your bank about options for managing and consolidating your debt, and HMRC can provide useful advice if you’re dealing with tax arrears.
As licensed Insolvency Practitioners, the company turnaround specialists at Begbies Traynor can advise you on a full range of business recovery solutions. Some company directors can be reluctant to consult Insolvency Practitioners due to the misconception that they push businesses towards insolvency procedures such as Administration or a CVA. However, the reality is that most firms that contact us continue trading and turn a corner without a formal procedure.
A company turnaround adviser will look closely at every aspect of your business to understand the challenges you are experiencing and where things are going wrong. They’ll then:
When searching for a company turnaround adviser, always check they are properly accredited by or members of a relevant professional body. Insolvency Practitioners must be authorised and licensed by the Insolvency Practitioners Association (IPA), the Institute of Chartered Accountants in England and Wales (ICAEW) or the Institute of Chartered Accounts of Scotland (ICAS). They all adhere to the same strict standards of professional conduct and performance.
There are several approaches you can take to turn your business around. The key is to act early before creditor pressure builds and your scope for manoeuvring is restricted.
The most suitable approach will depend on the specific circumstances of your business, with some of the most common solutions including:
Using one or more of these strategies can be very effective. However, the benefit of getting company turnaround advice from an Insolvency Practitioner is that they can also implement a powerful range of formal insolvency procedures if required.
If your business is struggling but you think it can be saved, seek company turnaround advice as soon as possible. At Begbies Traynor, we have many years of experience advising and supporting distressed companies. Please get in touch for a free, same-day consultation or arrange a meeting at one of our UK offices.
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