A business may require corporate restructuring for a variety of reasons. For example, the company may have financial problems and want to avoid corporate insolvency or seizure. Corporate restructuring is a lengthy process that involves difficult decisions but can ultimately save a company from going under. If your business is in trouble, here are five things you should know about corporate restructuring.
1. Avoid denial and face the facts
Look at your business with a critical eye and objectively analyze the reality of your company’s situation. The worst thing you can do when your business is struggling is to deny there’s a problem. The longer you wait to make changes, the more significant and challenging they’ll be to implement.
2. Don’t do it alone
When you accept it’s time to make changes to your business, seek professional help. A business advisor or licensed insolvency trustee can help you create a plan to rebuild your company.
You’ll have a lot on your plate as you go through the restructuring process. Therefore, designating an outside party to guide you will increase the chances of your business bouncing back.
3. Anticipate losses
Corporate restructuring can be a painful process. For example, laying off employees, cutting wages and restructuring management are tough decisions.
Additionally, you may be required to merge with another company, relocate your business or sell your assets. Ultimately, your business will be more efficient and valuable in the eyes of your stakeholders, suppliers and creditors.
4. Communicate with banks and suppliers
If you need to restructure your business, trust is key. For example, don’t keep your business problems a secret from your bank or suppliers. Instead, show them you’re capable of making smart decisions and that you have a solid restructuring plan. Working with your creditors during this time is essential for rebuilding and renegotiating contracts and terms.
5. It takes time
Corporate restructuring doesn’t happen overnight. The process is often long and time-consuming. In fact, it could take up to 24 months before your business regains stability and becomes profitable.
Remember that restructuring your business isn’t a sign of weakness or lack of ability.
CORPORATE FINANCIAL SERVICES IN OTTAWA AND EASTERN ONTARIO
If your business is struggling financially, the team at D. & A. MacLeod Company Ltd. can help you evaluate your options and come up with a solution. If you need to restructure your business, we’ll guide you through the entire process step by step. We also provide corporate proposals. Contact us today to schedule a free financial consultation with one of our licensed insolvency trustees.