How to restructure a failing business

Rescuing a failing company through business restructuring

Company restructuring can help rescue a failing business by identifying and improving problem areas that negatively impact the financial health of the company. There are many forms of company restructuring and the methods applied will be determined by the overall financial position of the company and the areas that require improvement.

Here are some of the ways to restructure a failing business:

Corporate simplification – If the structure of the company is overly complex, simplifying the set-up can increase operational efficiency and therefore, reduce costs and improve profitability.

Corporate simplification, also known as corporate streamlining, has a wealth of benefits as it can eliminate overheads, tax liabilities and reporting obligations that are unnecessary and avoidable which can transform a failing business.

Business finance – If the company requires funds to boost cash flow, acquire assets, grow, or plug the gap between invoice payments, access to competitive business finance can provide the company with much-needed cash.  

There are a range of short and long-term commercial finance options available to serve a variety of needs, such as invoice finance, refinancing, asset finance, bridging loans, and business loans.

“Spoke with Chris who put me at ease straight away. He was very knowledgeable and listened intently to all my worries and concerns. Will definitely be using Real Business Rescue and advise anyone with business issues to give them a call.”

Diana

 

Contact the Real Business Rescue Team today

Chris Bristow
Business Debt Expert

Company Voluntary Arrangement (CVA) – If a business is failing as it owes several creditors, a Company Voluntary Arrangement can give the business the breathing space it requires by spreading debt repayments over time.

A CVA is a formal repayment plan with creditors negotiated by a licensed insolvency practitioner. A CVA is a useful rescue tool for struggling businesses as it reduces the pressure on company cash flow by spreading company debts over the long term, typically between 3 to 5 years.

Any debts remaining at the end of the CVA will typically be written off, which means businesses can trade with a debt-free future in sight.

Company Administration – The company administration or pre-pack administration route is used to save the viable parts of a failing company to rescue the company as a going concern, secure a better return for creditors, or realise assets to raise funds for creditors.

If a sale is secured before the company enters administration, this is known as pre-pack administration.

While a company is in administration and seeks a rescue plan, a moratorium protects the company against creditor pressure. This gives the business the best chance of securing a lifeline with the help of a licensed insolvency practitioner who will control the company during the company administration process.

How can company restructuring save a business?

Business restructuring can provide a lifeline to struggling companies that require a helping hand with company debts and cash flow.  It provides a solution for businesses that need immediate insolvency support to turn around their fortunes.

Company restructuring is a tool also used by thriving companies that wish to finetune company operations, improve efficiency, and secure any missed opportunities.

Get a Quote Find Your Nearest Office

How can Real Business Rescue help restructure a failing business?

As a leading business restructuring and corporate insolvency provider, we are highly experienced in business turnaround. For more information on what company restructuring route is best for your company, get in touch for expert and immediate advice.

At Real Business Rescue, our team of licensed insolvency practitioners and business restructuring experts have supported over 25,000 company directors, and counting.

We provide specialist insolvency and restructuring help to company directors across the country. With over 100 offices nationwide and a dedicated helpline for distressed directors, our advice is always closely on hand.