Get exclusive money-saving offers and guides
Straight to your inbox
By signing up, you agree to the Finder
Privacy & Cookies Policy
and
Terms of Use, Disclaimer & Privacy Policy.
What is business turnaround and restructure finance?
Looking to get your business back on track? Find out what’s involved with business turnaround and restructure finance.
Loan Types
I Need
We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
Trying to rescue a struggling business can be a harrowing experience, with the threat of insolvency lurking behind every business decision. Financial troubles in your company are often caused by external factors that may be beyond the control of directors or shareholders. Whatever the reason, when problems begin it is important that the company acts calmly and quickly.
If you are trying to turn your business around, there are financing options available. Learn more about them, and if it could be an option for your business, in this guide.
What is business turnaround finance?
Some lenders in Australia specialise in restructure and turnaround finance. These services can provide you with the necessary funds to keep yourself trading, and also help you identify the changes that will need to be made to recover. Restructure finance can also help you finalise trading while minimising further loss to the business.
Moula Business Loan
Moula Business Loan
- Borrow up to $250,000
- Flexible lending criteria
- No hidden fees
100% confidential application
Moula Business Loan
An unsecured business loan with online application and no upfront or early repayment fees.
- Interest rate type: Fixed
- Loan security: Unsecured
- Upfront fee: 2% Establishment fee
- Minimum loan amount: $5,000
- Maximum loan amount: $250,000
- Maximum loan term: 2 years
Business lenders you can compare
What are my options?
Depending on the lender you opt for, restructure finance can provide you with a selection of potential routes to go down:
Restructuring support
A restructuring company works with you to analyse all aspects of your business, identify areas for improvement and find where profitability can be increased. It can also provide support and advice for stakeholders who may be unsure of what to do next.
- By acting early, you can potentially save the company from taking more drastic action later on.
- In the wrong hands, restructuring can be a frustrating, expensive and an ultimately unsuccessful pursuit.
Debt restructuring
If you are consistently falling behind with your payments, you can opt for debt restructuring to have the company help you negotiate with creditors to give you more time to pay or find alternative funds and payment plans.
- Companies that maintain regular communications with their creditors can be optimistic about the chance of successful negotiations, especially with the backing of an experienced restructuring service.
- Ultimately the fate of your company lies in the hands of creditors who will want guarantees of repayments as soon as possible.
Cash management
For a business feeling the effects of a sudden drop in sales, a short period of assisted cash management can help ease the minds of stakeholders and creditors. This will often include methods such as improving the company’s forecasting models and reviewing its cash requirements and management options.
- This option provides an efficient means of highlighting problems within your company and identifying solutions.
- Cash management will do little to confront existing debt problems or deal with larger issues created by falling revenue.
Voluntary administration
An independent administrator will be appointed by the director to assess the likelihood of the company being able to continue trading. This will usually involve meeting with creditors and attempting to come to an agreement regarding missed or overdue payments.
- This is easy and inexpensive to carry out
- It provides a comprehensive review of the company that can be used to identify problems and strengthen for the future.
- Attempts at voluntary administration are often misguided and requires expert guidance to have any chance of success, with only a fraction of businesses saved.
Receivership
This involves the bank or another influential creditor appointing a receiver with the sole objective of recouping funds to settle the company’s debts. This can sometimes be achieved by selling assets, but may require the sale of the entire company.
- The bank can go a long way to steadying the ship and taking back control of a chaotic business.
- Liquidation is rarely avoided, with little incentive for the receiver to do more than reclaim creditors’ money as quickly as they can.
What to know before you apply
The avenue you choose will depend on the current status of your business and what you need out of the loan. Whatever you decide to do, there are a few issues that should be kept in mind:
- Ask your accountant for their thoughts but always back yourself up with a second opinion. It’s a good idea to do some additional research before you make a decision.
- There are many companies offering restructuring services online. Your best chance of success will be with an experienced and recommended firm.
- Watch out for upfront costs and always agree on a set price for the company’s services before you start.
Need to manage cash flow?
If outstanding invoices can help turn your business around, then you may want to consider invoice financing. It's a type of business loan that comes with reduced risk, no asset requirements or interest payments.
Compare the invoice financing products below.
Picture: Shutterstock
More guides on Finder
-
RelayPay cryptocurrency card and app
FInd out about how RelayPay works, what cryptos and fiat currencies it supports, the fees for using it and safety information.
-
ZitSticka Rundown: Do you know what type of pimple you have?
To put it simply, you can't treat a pimple properly if you don't know what type it is.
-
Best dual SIM phones
If you’re looking to run multiple phone numbers from just one handset, we’ve got the best picks for every price bracket and need.
-
Binance Smart Chain (BSC) beginner’s guide
How to get started on Binance's DeFi-optimised blockchain, including how to use it, what you can do on BSC and pros and cons.
-
Withings Body Cardio Scale review: Smart scale at a serious price
If you’re keen to be mathematically encouraged – or possibly pestered or frightened – into losing weight and improving your overall health, the Withings Body Cardio scale is a great but seriously premium-priced scale.
-
7 best power stations in Australia 2021: Portable batteries
What is the best portable power station you can buy in Australia? Here’s how to choose the right battery pack for your next camping or four-wheel driving trip.
-
Metamask wallet review and guide
All you need to know about Metamask – the browser extension digital wallet and a user-friendly bridge to the world of Ethereum decentralised applications.
-
What is an automated market maker?
Discover what an automated market maker is in DeFi and what it offers in comparison to the traditional market-making system.
-
Ring Video Doorbell Pro 2: Powerful home monitoring
The Ring Video Doorbell Pro 2 is the company’s best home doorbell by a long shot, but it’s not suitable for renters, and it’s not inexpensive either.
-
Dollar Shave Club discount codes and coupons June 2021
Look and feel fresh each and every day with razors, shaving creams, after shave lotions and more delivered to your door.
Ask an Expert
