Recovery of Distressed Businesses

The business recovery process is one of the most complex and difficult processes for the company’s owners hence from the business point of view and from the emotional perspective, and this makes the process of decision making and ongoing operations even harder.

The work environment of managers in these situations is characterized by immense pressure created by creditors knocking at the company’s door, in difficulties in raising credit and workers who are usually aware of the company’s problems and are uncertain about their jobs.

Techtrends Management Consultants Ltd. has extensive experience in planning and implementation of recovery programs in which the company brings to bear its combined skills in the following fields of expertise: business strategy, marketing strategy, financial, budget and control planning, planning and implementation of production and logistics systems, supply chain, IT systems and organizational consulting.

The recovery process is carried out by Techtrends Management Consultants Ltd.’s multi-disciplinary team that is composed, on a case by case basis, of expert consultants in finance, marketing, operations, and organizational psychologist and legal advisor. The goal of the team is to examine and assess the company’s recovery potential, to prepare a “rescue” plan, and to guide its implementation.

The recommendation submitted by the team of experts to the company owners can range from initiating a recovery program to a recommendation to close the company, that includes a plan to protect the company owners aimed at minimizing the economic impact on them.

The recovery plan is usually comprised of the following steps, most of which are implemented in parallel:

• Examination and mapping of the company’s condition
• Analysis of the company’s recovery potential
• Preparing a detailed business plan that includes goals, a work plan for their realization and sources for raising working capital
• Establishing industrial peace that will enable the company to function under conditions of uncertainty
• Worker participation in the recovery process
• Conducting negotiations with creditors
• Increasing the business’ sales
• Reducing costs that do not directly contribute to revenues and improved work process efficiency
• Retaining essential employees and discharging non-essential employees
• Raising capital for the company, from internal or external sources, backed by a recovery plan
• Examining the possibility of adding a strategic partner or alternatively a capital investor to infuse capital into the company
• Implementation plan
• Accompanying the plan’s implementation