Are financial troubles looming for your business? With only one wrong move or bad decision, you could find yourself in a highly precarious situation. In this post, we’ll guide you through the journey to securing your company’s future, answer the question “what is restructuring in business?”, and much more.
Financial difficulties can affect any company, and arise from all manner of sources, including both internal missteps and external factors beyond your control. The business landscape is an unpredictable place, and even well-established firms can face significant threats to their survival.
So, if you find yourself in a difficult spot, with seemingly little room to manoeuvre, what options are available to you to consolidate your position in the market and secure a brighter future? One of the most effective methods is company restructuring. Read on to find out what it is and how it could benefit you.
What is a Business Restructure?
What is a business restructure? Essentially, it is a significant action undertaken by a company with the aim of modifying or reshaping its operations. The core goal of a corporate restructuring is generally to reduce debt, increase efficiency, and improve overall performance — putting the company in a better position for long-term success.
Restructuring is a tool most commonly used by companies facing financial difficulties. For example, a business struggling with increasing debts or late payments may look to restructure in order to create a sustainable plan to repay any creditors and manage existing liabilities.
A company that finds itself in increasing debt, that is struggling to make payments on time, will often opt to restructure in order to come up with a sustainable way to repay any creditors and pay off any accrued debt.
Other common causes for restructuring are:
- Reduce/consolidate debt
- Merge with another business
- Reduce company costs
- Rearrange roles within the company
Why Corporate Restructuring is Important?
Business restructuring isn’t just a last resort — it’s a powerful strategy for companies looking to overcome challenges and seize new opportunities. Whether your goal is to revive a struggling business or prepare for future growth, restructuring can provide the foundation for long-term success. Here’s why it’s essential:
- Revives a Struggling Business: Restructuring can turn around a company in sustained decline.
- Increase Value: Streamlined operations can often lead to higher profitability going forward.
- Prepare for Ownership Changes: Sets the stage for future mergers, acquisitions, or sales.
- Promotes Long-Term Growth: A newly restructured company will be much better positioned for future success.
- Better Adapt to Market Changes: It helps companies stay more competitive in a constantly shifting economic landscape.
Overall, the importance of corporate restructuring stems from the ability to right the ship, turn away from a developing storm and head towards calmer waters. It can act to save a company in decline, while setting it up for success.
How to Restructure a Business
The total time to undertake a successful company restructuring will depend on a multitude of factors, no two cases are ever exactly the same, as such, one restructuring could take significantly longer than another.
The timeframe can depend on a few factors, for example, if a company is under threat of liquidation and desperately needs to restructure within a certain period of time to rescue the business.
Regardless of the circumstances behind a restructuring, it is vital that you don’t go in unprepared. A qualified professional can come in at the planning stage and guide you towards a successful restructuring that can help you achieve any goal you have set.
The business restructuring process has a number of things to consider:
Identify Issues
A key step when restructuring to nurture long term success is to, simply, assess what specific area needs restructuring. Restructuring can come in multiple forms, one of the most common is in streamlining a business. This involves identifying the areas of the business that are failing, which can then either be shuttered, scaled down, or modified.
A reorganised and slimmed down business is a more efficient one. In assessing each aspect of the firm, you will gain additional insight that can also be helpful when planning for the business post-restructure.
If you can locate a particular area of the business that is struggling to maintain appropriate standards then you need to begin considering what a restructure can do to improve this aspect, and ease the burden for the betterment of the company on the whole. There is no point rushing into a restructure without considering what’s the best way to tackle it.
Preparation is Key
Once decisions over what aspects of a business are being restructured has been decided, it is vital that you create detailed plans of how restructuring can take place. What changes are to be made, what impact it will have etc.
It is pivotal when creating these plans, that you prepare for both the short and long-term of the business. This preparation is vital to safeguard the company’s best interests not only during the restructuring, but also in the immediate aftermath and in the long run.
Restructure Safely
The process of restructuring can, in itself, be a challenging and uncertain time, with a fair share of stumbling blocks awaiting you if you aren’t careful.
With the threat of jobs being lost looming overhead, it can also be an emotional time, it is key that a restructuring is handled with tact.
An important step to getting through a business restructuring unfazed can be to speak to trusted industry experts, to seek their support and assistance through the entire process.
No matter what you need, seeking advice as early as you can protect you against any possible complications that could arise at any time,
Assess, Assess, Assess
A vital step that companies often neglect to do is to undertake a proper overview of the restructure. Have the initial goals of the restructuring been met? Can anything be improved further? Is the business now set up for long term, sustainable success after the restructure?
Answer all of these questions and you should have a clear and transparent view on where your business is headed.
Expert Corporate Restructuring Advice from Inquesta
With corporate costs ever-increasing, some companies are feeling the crunch. Restructuring your business can be the best way to make sure that you are operating in the most efficient, optimal way for sustained future success.
At Inquesta, we specialise in helping businesses navigate the restructuring process. Our expert team has years of industry experience and are qualified to offer a trustworthy service, to educate you on the restructuring process, and guarantee that your business is set up for the future.
Whether you’re looking to reduce debt, improve efficiency, or prepare for a change in ownership, we’re here to help you.
We offer a bespoke service designed to meet your unique needs and ensure that your business is set up for long-term success. From planning through to execution, we’ll guide you every single step of the way.
We know that when it comes to your business, you want a bespoke service from top to bottom, and that’s why we make sure to provide a personal service in a delicate and professional manner throughout.
Take the First Step Today
If you’re considering restructuring your business, it’s important that you don’t wait until it’s too late. Contact Inquesta today for a free consultation with a restructuring expert. Let’s work together to secure your company’s future.