Best strategies for difficult times

When companies struggle to improve performance in various facets of their business, the expertise of a turnaround professional can be crucial to both work through the issues and prevent disaster. Veritas Advisory have a number of professionals with the capacity to apply strong turnaround management strategies and techniques to successfully navigate businesses through times of difficulty.

Initially, we undertake a full analysis of the Company and its business. We can be instructed to undertake a comprehensive business review where we report directly to the Board or financier. We look at the six pillars of a business which include:

 

Structure
  • Determine the viability of the organisational structure;
  • Review the current business model and plans;
  • Review overall operations and performance of each division;
  • Review the structure of the debt and security issues; and
  • Review market positional issues and major threats and business weaknesses.

Financial Control

  • Assess the strength of the accounting policies, financial systems and controls;
  • Review the current financial plan, cash flow forecast and recent financial performance;
  • Review working relationship with existing lender and quantify risks;
  • Review corporate finance options and alternatives like disposals and acquisitions; and
  • Review effectiveness of working capital management.

Revenue

  • Review current revenue expectations;
  • Determine the market penetration and whether sufficient sales yields are met; and
  • Review sales targets and conversion rates and scope for improvement.

Personnel

  • Review key management personnel;
  • Review personnel productivity and possible productivity improvement; and
  • Identify capacity shortfalls and individual weaknesses and strengths.

Stakeholder Management

  • Identify actual or perceived stakeholders in the organisation;
  • Confidentially liaise with each key stakeholder to ascertain desired outcomes;
  • Include key stakeholders in the decision making process; and
  • Identify other potential new stakeholders for the future plans.

Operations

  • Review operations within each division;
  • Review organisational implementation of business plan;
  • Scope fluidity of communications between divisions; and
  • Review operational systems and effectiveness.

 

In our experience, identifying causes of under-performing businesses early, increases the opportunity for any business to secure a more effective future and implement a robust recovery plan.  Veritas Advisory have strong and reputable resources in Forensic analysis which is an asset in identifying the real cause of a problem.

What is paramount in our approach with each Turnaround matter is that we adopt a strong confidential process in order to maintain the integrity of the core business we are engaged to review.

Ultimately, if the comprehensive business review reveals that the company requires a financial to sort out the balance sheet so that the business turnaround can be implemented, then the informed decision can be made by the Directors to place the Company into the Voluntary Administration regime. The following provides a summary of some of the advantages of this process:

 

Voluntary AdministrationDeed of Company Arrangement
  • Appointments can be made immediately.
  • Allows the implementation of a new business plan.
  • The Directors are in control of the appointment and an opportunity for the business continuing to trade.
  • Allows the stakeholders to partake in the overall decision.
  • The Directors can be in control of the future of the Company.
  • Allows a change in the structure of the Board and/or shareholders if required.
  • Secured Creditors are completely involved in the information available and are informed of the overall plan.
  • The rights of the secured creditors are preserved.
  • Business operations and not impeded in order to maximise the return to all stakeholders.
  • The employees can maintain their roles within the organisation without the impost of termination and re-engagement.
  • There is an immediate moratorium of all unsecured claims.
  • Unsecured creditors can receive a higher return.
  • Landlords and claimants under the PPSA are dealt with efficiently and appropriately.
  • Suppliers, landlords and other external stakeholders can benefit from a business that survives.

 

When situations are presented that aren't clear and concise, the Veritas Advisory team is well placed to provide independent, professional confidential and quality advice.

Contact Veritas and start now

When things aren’t right, the most difficult part is to recognise we just need help and to take the first step towards finding the best outcome.

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