How To Find A Good Turnaround And Restructuring Consulting Firm

The COVID-19 outbreak has affected a number of businesses significantly. While the impact has varied from industry to industry and according to business size, it has been felt around the world. The worst impact has been on small businesses. A survey conducted in the US revealed that at least 43% of small businesses in the country had to be closed temporarily owing to a lack of sufficient cash in hand to manage expenses when sales were negligible. This number would be much larger if we include the travel and hotel industry, which faced the brunt of the pandemic. As the world slowly emerges from the shadow of this crisis, many business owners are looking to revive their ailing businesses. This is likely to lead to an increase in demand for turnaround and restructuring consultants.

These consultants work on a four-step plan:

1. Research and identify the problemrn2. Align stakeholders with the issue at handrn3. Build strategiesrn4. Execute the turnaround plan

Turnaround Consultants Can Save You!

The global management consulting market was estimated at an impressive USD295bn in 2020. Demand for management consultants, including turnaround consultants, has been growing. A turnaround consultant advises businesses on the best practices and methods they can adopt to recover from a slump. Although such consultants have been around for a long time, the pandemic has led to an increase in demand for their services. While many business owners may be considering the use of turnaround consulting services, most may be unaware of the skillsets they need to look for in a consultant; we discuss some of these below.

Quantum Of Experience

Experience plays an important role in turnaround consulting. Business owners may not possess the knowledge and understanding required to face the unique challenges or problems posed to their firm by events such as the pandemic. In such a situation, they should look for a consultant with sufficient experience in and knowledge of dealing with such crisis situations. Using the services of a consultant who has previously worked in a similar industry would provide an added advantage, as they would be cognisant of the specific requirements of the business. For instance, a consultant who has worked in the hospitality industry may be able to understand the concerns of a hotelier better than a consultant who has no prior experience working in the industry.

Ability To Understand Financial Intricacies

Two key concerns of businesses is cash flow management and inability to put available leverage to efficient use. In the current scenario, many firms are looking at either restructuring their loans or taking on additional debt to keep their businesses running. A turnaround consultant should be able to understand the financial intricacies associated with specific businesses. Only with such an understanding would they be able to procure sufficient financing for the company. A firm that operates in an industry with high overhead expenses may need a large loan that can be repaid over a longer period of time, whereas a business operating in an asset-light industry may need financial restructuring only to help it tide over short-term concerns.

Leveraging Technology

Technology plays a key role in modern-day business. Data banks, artificial intelligence-led platforms and other technology-driven solutions, if put to effective use, can propel businesses to new heights. Turnaround consulting service providers should be able to make use of these solutions while advising clients. In addition to providing enhanced financial analysis, these services can enable businesses to design marketing strategies and campaigns that boost their presence. Businesses may have to wade through troubled waters from time to time. Many industries are cyclical; sometimes, a black swan event, such as the pandemic, may leave a deep impact on businesses. In such a situation, restructuring the business and attempting to turn around is a better option than ploughing on. Consultants, such as Acuity Knowledge Partners, leverage their technology-based solutions and tools to assist businesses. These firms provide solutions such as database management, financial reporting advisory and financial monitoring to help businesses implement goal-oriented solutions.