What’s involved in business recovery?

What does business recovery mean?

Turning a company around involves getting it back on track when financial, organizational or operational issues threaten its survival. What is the objective? To avoid bankruptcy and restore long-term profitability. To achieve this, professionals must create a recovery plan.

When should you consider business recovery?

Here are a few warning signs you should watch out for:

• You frequently pay your invoices late;
• Your debts have piled up and become unmanageable;
• Your revenue or sales have dropped from month to month;
• Your cash flows don’t cover current expenses;
• You’re losing major clients.

If you recognize several of these warning signs, take action and call on professionals like those at Raymond Chabot! The faster the situation is handled by recognized business recovery experts, the higher your chances of success.

What are the principal stages of a recovery plan?

Business recovery is a complex process. The key steps are outlined below.

1. Carry out an operational diagnosis

   First of all, you must identify the issues that led to the organization’s current situation. This requires working closely with a team of professionals in order to:

• • Analyze the organization’s historical financial statements;
  • List its strengths and weaknesses;
  • Identify the obstacles to overcome;
  • Conduct a periodic analysis of cash inflows and outflows;
  • Assess the debt level;
  • Determine how you can stand out from your competitors;
  • Identify business opportunities.

2. Draw up an action plan

   You’ll put concrete solutions in place. This may include reducing certain expenses, securing financing, reviewing the organizational structure and realigning priorities. The diagnosis allows you to determine the right action plan.

3. Engage with partners

   In some respects, you should be transparent with your creditors, bankers and suppliers and inform them of the situation in order to benefit from time or support. When you work with an expert, they can help you broach such discussions.

4. Take action

   Naturally, you must act fast and implement every step of your plan. You must also adjust your work methods and mobilize your teams to get your business back on track.

5. Track and adjust

   A business recovery plan must be monitored. Regularly analyzing the results and making any necessary adjustments is important.

How can a trustee firm help you?

A firm such as Raymond Chabot with Licensed Insolvency Trustees who specialize in supporting businesses can guide you each step of the way. Ideally, you should choose a team that includes professionals who hold CIRP (Chartered Insolvency and Restructuring Professional) designation.

In short, turning your business around is certainly not a failure. It’s an opportunity to breathe new life into the company and change what’s no longer working. If you feel that your organization is in difficulty, speak to one of our experts today. Our team is here to help and offer solutions tailored to your reality.