Running a business in a constantly fluctuating market can be tough. During distressing times or when faced with the possibility of insolvency, business restructuring could be a promising lifeline. A business restructure generally involves overhauling a company’s operational, financial, or organisational structure to improve efficiency. This could range from modifying internal processes and realigning business strategies to overhauling the business’s financial arrangements through corporate debt restructuring.
With access to simpler, more flexible restructuring options, there are several business restructuring strategies to help you get back on track. At Mackay Goodwin, we’re in the business of helping businesses—at every stage. Together, let’s find your pathway to recovery and sustainable growth.
Australian Business Restructuring: Stability, Sustainability & Success
Every business experiences ups and downs. With business environments constantly changing, staying ahead often requires a fresh approach. Whether it’s due to economic shifts, competitive pressures, or technological advancements, a company restructure can be a strategic move for your business, helping it stay viable and competitive. Early engagement with an insolvency expert in these moments lets us address any issues before they escalate. Making progress requires positive action, and we take the initiative every day.
When you engage in an Australian business restructuring, your company gains the room to realign operations and seize new opportunities, reducing risks for a thriving business. Our team acts with intelligence and innovation—what might otherwise be a path to potential insolvency can become a strategic rebirth, setting the stage for long-term success.
Key Business Restructuring Strategies
Before we answer the question ‘How to restructure a business in Australia?’, it’s vital to thoroughly assess your business’s current position to start on the right foot. This is where seeking guidance from an expert makes a difference. We’re in the business of resolution. To achieve it takes sharp focus and determination, and your business deserves far more than a ‘one size fits all’.
We start by reviewing your financial statements, understanding your debt obligations, and evaluating operational efficiencies. We analyse and pinpoint critical areas that need attention, setting the stage for informed and effective business restructuring strategies. Once our experts have determined the best path forward, we work our magic.
Stability with Financial Restructuring
We get to the root cause with a financial restructure. This includes renegotiating debts and restructuring capital. We provide strategic, innovative changes to investment plans to align with business objectives, ensuring financial stability.
Restructuring offers a chance to refocus on what your business does best. We identify your core business areas that generate the most revenue and form plans to align resources to support and expand these areas. Divesting non-core assets can also provide the necessary capital for reinvestment into growing parts of your business.
Diversification is another key business restructuring strategy to mitigate risks. This could mean introducing new products or services and tapping into different markets to broaden revenue streams and reduce dependencies.
Small Business Restructure & Safe Harbour
For small and mid-sized enterprises, a small business restructure could be the best option. If your business is eligible for this option, we work with you to reorganise your operations, debts and processes. This strategy lets you remain in the driver’s seat while we develop a restructuring plan to achieve a sustainable outcome and avoid insolvency.
If your company is approaching insolvency, we might suggest taking advantage of the safe harbour provision. This provides you protection from risk and preserves value to get you through the tough times. This option gives you the breathing space and time to get your business back on the front foot without the possibility of insolvency looming. This lets us plan your next move to keep your doors open.
Restructuring your finances goes hand in hand with reevaluating your operations. Simplifying your processes can reduce costs and boost productivity. This could mean consolidating roles, cutting inventory costs, optimising supply chain logistics, or outsourcing non-core activities. As markets shift to a digital-first space, improving technology integration is key. Our team assesses your circumstances to suggest strategies to best position your business. Strategies may include adopting e-commerce platforms, customer relationship management systems, or advanced analytics to better understand customer behaviours and market trends.
Voluntary Administration and DOCA
If you’re facing imminent financial challenges, voluntary administration offers a pathway to recovery with expert guidance while protecting businesses from creditor actions.
When appointed as your administrator, we strategise to maximise the chances of your business continuing. We’ll thoroughly assess your business’s financial situation, formulate a solid plan, and present a report to creditors. This report includes recommendations on whether your company should enter into a deed of company arrangement (DOCA), be liquidated, or return to the directors’ control. In cases where exiting is the best option, we provide comprehensive support for a dignified outcome.
Step-by-Step Guide on How to Restructure a Business in Australia
1. Appointing Us as Your Insolvency Advisor
Get in touch with us to start your restructuring journey. We’ll thoroughly assess your current business position and identify areas of improvement. This includes financial reviews, operational evaluation, and market positioning. Our team takes the time to understand where your business stands and propose the best business restructuring strategies for moving forward.
2. Our Team Develops a Strategic Plan
With the insights gathered, we craft a strategic restructuring plan tailored to your unique challenges and opportunities. This may involve corporate debt restructuring, where we negotiate with creditors to modify debt terms, potentially lowering debt burdens and extending payment timelines to improve liquidity.
3. Taking Action & Making Changes
Once a clear strategy is in place, we make it happen. This could mean streamlining processes, divesting non-core assets, or integrating technology to boost efficiency. Throughout this phase, every decision aligns with your business goals with the aim of setting you back on the right track.
4. Staying in Touch with Stakeholders.
We keep your stakeholders, from employees to investors, in the loop. This creates an ongoing and open dialogue to ensure everyone is on the same page and supportive of the new direction. This transparency builds trust and aids in the smooth implementation of changes.
5. Keeping Track to Stay Agile
Restructuring is not a set-and-forget solution. Our dedicated team actively monitors the impact of implemented strategies, making adjustments as necessary. This dynamic approach allows us to respond swiftly to new challenges and opportunities post-restructure.
What’s Next After Restructuring?
After restructuring, our focus shifts to stabilisation and growth. Continue to review your business performance against the benchmarks we’ve set together and adjust your strategies as needed. This ongoing process will ensure that your business not only survives but thrives in the new structure.
Get in touch with Mackay Goodwin today for a restructure handled with precision, strategic foresight, and innovation. We’re your key experts, helping Australian businesses with restructuring nationwide.
FAQs
How does corporate debt restructuring work?
Corporate debt restructuring involves negotiating with creditors to modify the terms of your debt. This could include reducing the total debt amount, extending payment timelines, or altering interest rates to improve your business’s cash flow and financial stability.
What options are available if my business is close to insolvency?
If your business is nearing insolvency, options such as voluntary administration, entering into a Deed of Company Arrangement (DOCA), or taking advantage of safe harbour provisions can provide protection. These strategies allow your business to reorganise while being shielded from creditor actions, giving you the breathing space needed to strategise for recovery.
What is a DOCA, and how does it fit into business restructuring?
A DOCA is a binding agreement between a company and its creditors that outlines how the company’s affairs will be dealt with to maximise the chances of the business continuing or to provide a better return for creditors than an immediate liquidation.
How helpful is restructuring for my business?
Strategic restructuring can transform a potentially insolvency-bound business into a revitalised entity. By realigning your business operations, financial strategies, and organisational structure, restructuring offers a chance for your business to thrive and grow in the competitive Australian market.
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