An effective business turnaround plan can mean the difference between success and failure. It has the power to get your company back on track following a financial jolt or sustained period of underperformance. Effective cash management strategies are vital even in the best of times to ensure your business remains streamlined and fully focused.
Whether you’re part of a struggling organisation or aiming to optimise your operations, our wide range of services will support your company every step of the way.
Read on to find out what our business turnaround specialists can do, along with the different cash management services we offer.
What is a business turnaround strategy?
A business turnaround strategy is a plan of action designed to stabilise an underperforming or struggling company. It aims to put the business on a more sustainable footing during a period of stress, preventing failure and ultimately placing it on the path back to growth.
There are many reasons why a business turnaround plan may be needed, from running low on cash to losing a major customer.
An effective strategy can tackle each problem in turn and identify ways to overcome them. For example, this might involve cost-cutting, refinancing, discussions with lenders or increased marketing efforts.
However, the key principles of business turnaround management aren’t just for underperforming companies. Diligent cash management helps growing firms to stay on the right track too.
What business turnaround and cash management services does Evelyn Partners offer?
Whatever your company’s scale or financial position, there are a number of ways we can help with turnaround advisory and cash management solutions.
Business turnaround planning and implementation
With extensive experience in industry of successfully delivering turnaround and transformation for stressed and high-growth businesses, we cover the end-to-end process, whether you need assistance at a strategic level or in-depth support and project management. Our Partners are Institute for Turnaround accredited.
Evelyn Partners LLP is a Corporate Partner of the Institute for Turnaround, the UK’s leading membership organisation for turnaround experts. A number of our team are also personally accredited to the highest standard by the Institute for Turnaround to help underperforming businesses avoid unnecessary insolvencies.
By combining segmental data analytics with business understanding, we put the spotlight on underperforming sales or margins, overspent costs, inefficient operational processes and ineffective controls.
We work closely with businesses to achieve targeted improvements and provide tools to monitor ongoing performance.
Working capital cycle review and improvement
We combine data analytics, industry insights and commercial acumen to review the whole working capital cycle, identifying tailored improvements to processes, practices and controls.
By using segmental working capital analytics, we drill down into the root causes of issues and target achievable solutions, which are then monitored by live dashboards.
Our working capital consulting service can also focus on single areas, such as customer receivables, stock or trade payables.
Integrated cash flow forecasting
Our team of experts can help with improving your company’s cashflow forecasting. We make forecasting more robust and enhance predictive effectiveness by systemising inputs, streamlining processes and building in feedback loops.
Our integrated approach to cashflow management improves the speed of forecasting, enables data-led decision-making, enhances stakeholder confidence and manages risk. We also provide complex financial modelling services.
Targeted troubleshooting support
With wide-ranging industry and advisory experience, our cash management and business turnaround professionals can provide a tailored troubleshooting service. We’re able to fix a variety of issues, from data cleansing to unblocking project delivery.
The trigger to our involvement is often when leaders have been dragged into the detail and lack sufficient time, or when an external voice is needed to focus attention and ensure delivery. We can step in to support leaders, helping them refocus on strategic issues.
Stakeholder management and monitoring
We use our industry experience to conduct strategic, financial and operational reviews of businesses for stakeholders, and provide options and recommendations.
We also complete more targeted, tailored reviews for stakeholders on risk areas such as cash flow forecasting or receivables conversions.
What makes Evelyn Partners different?
Whether it’s input on how to improve cashflow or working capital consulting, our highly tailored, hands-on services make us stand out from the crowd.
Our experts don’t simply write reports that quickly get forgotten about. Instead, we delve into what really makes a company tick, writing business plans, helping with strategies and supporting on project management.
We can also provide an interim management service, with our experts potentially serving as directors of your firm.
Frequently asked questions about business turnaround and cash management
How can I free up cash from my business?
You can potentially relieve cash pressure on your business in three ways:
- By unlocking cash from the balance sheet. This can be done through improved working capital, a disposal of surplus stock or the disposal of non-core assets
- By making profit and loss improvements, including identifying cost reduction opportunities
- By bringing in new finance (debt or equity)
It can be difficult to identify which is the best option for your organisation, let alone complete the planning and practical implementation. That’s where our business turnaround and cash management solutions can help.
We will complete a 360-degree business review to identify the best route forward, giving your board and stakeholders confidence that solutions are available. We pride ourselves on supporting successful implementations to help free up cash quickly.
What are my options for raising quick finance?
Various sources of finance may be available to your business, with pricing dependent on the level of risk for the lender. However, businesses are often restricted by agreements with incumbent lenders, the level of security available and profitability.
Asset-based lending often works well when businesses want quick finance and have assets available as security. As part of our cash management services, we offer strong knowledge of the market, including specialist and niche lenders. We also understand what options work well in the timeframes available.
What should a business consider when seeking loan repayment deferrals?
In some circumstances, it may be appropriate to seek loan repayment deferrals from existing lenders. That being said, there is a lot of work to be done to achieve the best chance of a lender agreement.
Ideally, integrated financial forecasts should be prepared, including sensitivity analysis, a detailed short-term cashflow forecast, a review of security available and an ability to show alternative options have been considered and attempted.
If any operational or financial improvements are required, project plans and tracked performance will need to be shared. This will give the lender confidence in your ability to deliver planned improvements.
There is a balance to be struck between the timing of a request and information preparation, and consideration of your relationship with the lender, such as any previous deferral requests.
Our experts will ensure all your information is thoroughly prepared and that alternative options are carefully considered.
How can I unlock cash from a balance sheet and improve working capital?
Releasing tied-up cash can give valuable breathing space to a business, freeing up time and reducing pressure.
Various methods are available to help you unlock cash and improve working capital, including:
- Asset sales
- Raising finance against assets
- Lowering cash tied up in working capital by extending the time to pay creditors or reducing stock balances and the debtor payment cycle
It’s important to understand the whole picture and overall working capital cycle to identify the best solutions for your company. We can analytically review your balance sheet and supporting dataflows to identify opportunities to unlock cash. The effective implementation of these opportunities is also critical. Operational reforms may be required to embed solutions, such as changes to contracts, debt collection processes or sourcing arrangements.
How can I cut costs in my business?
Reducing costs is a controllable way to generate valuable cash for your business and potentially improve profits, but this must be done with appropriate care and attention.
Insufficient cost reduction risks the viability of the business. But if too many costs are cut, critical mass can be lost and negative signals may be sent to the remaining workforce, customers and suppliers. This can also risk viability and the organisation’s reputation.
Businesses should regularly review their cost base to ensure spending remains effective and lean. However, when costs have got out of hand, or are impacting profitability and cash generation, a more in-depth review should be undertaken to strategically assess spending.
Our business turnaround specialists will categorise spending based on factors including:
- The ability to be replaced (such as by robotic process automation)
- Benchmarking against best-practice companies. For example, among B2C companies, using metrics such as cost to serve, cost to acquire, and staff-to-customer ratios
We always consider the ease of implementation, impact and timeframes to achieve cost reduction opportunities. We also take any upfront costs into account to help generate a plan to implement and track against.