While the measures put in place by the Federal Government to support the economy have provided a buffer, there is no doubt that we will still see some businesses close as our economy slows down. However, there are many more options available to businesses to weather a financial storm than may first appear. Identify the warning signs early; the more options you have.
With the help of a suitably qualified advisor, you can determine if it is possible for you to:
Early insolvency indicators do not mean your business is doomed. Proper advice and understanding your turnaround options as early as you can ensure you have every chance to set it right.
There are options available to businesses experiencing financial distress. There is access to funding – both traditional and alternative, with billions of dollars in debt and private equity looking to find a home.
There are also ways of accessing solutions through a Voluntary Administration to effectively restructure your business. For instance a Deed of Company Arrangement (DOCA) is a largely misunderstood and underutilised process which can allow businesses to implement the changes necessary to come out the other side stronger than before.
With the additional time afforded by the Federal Government’s temporary relief for directors of companies in financial distress, via changes to the insolvency law provisions – there is no better time to take an honest look at your long term prospects and plan accordingly.
It can be hard to decide where to focus your business in stressed or distressed conditions. Our resilience wheel outlines five key considerations for businesses, with cash management at the centre.
Every industry and sector of the economy is being affected differently. Some have larger exposure to consumers, others more greatly impacted by the stall in global supply chains – all have to find their own path through this downturn to come out the other side.