Business Turnaround & Restructuring
Small business restructuring
A lower-cost solution to restructure small business debt
COVID-19 created a tough economic environment for many small businesses and the government made changes to allow directors to restructure debt more easily and with less expense to weather the storm—while staying in control of the business.
Background
Directors who want to try to save their business may choose to restructure company debt while retaining control of business operations and creditor relationships.
Service highlights
Business can be tough. Before you throw in the towel, we help you consider what can be done to turn a business around, exploring restructuring options that can buy you valuable time to get back on your feet.
There's two phases in the restructuring process. In the first phase, where the plan for creditors is being worked on, directors can get the space needed in the comfort of knowing that creditors are aware that a plan is underway.
Directors retain control of business operations. A registered small business restructuring practitioner, is there to support and guide the restructuring process and handle the creditor processes.
With creditor approval, the small business restructuring process takes 35 business days or less.
Due to simplified design, small business restructuring takes less time than other formal insolvency processes.
Because of reduced costs and turnaround times, more small businesses can readily access this solution.
Due to simplified design, small business restructuring is significantly less costly than a voluntary administration.
Download
Get our Guide to Small Business Restructuring to get the overview of how the whole process works, which is also outlined in a 35 business day step-by-step flowchart.
COVID-impacted hospitality business
Prior to the COVID-19 pandemic, the business owners ran a thriving café. The Victorian government-imposed restrictions throughout 2020 and 2021 materially impacted the business’s turnover and profitability. The business owners pivoted the business as best they could—they catered for take-away-only service, increased their reliance on food delivery platforms, and leveraged government support. However, sales reduced, cost of goods increased, and staff wage pressures strained the cash flow and meant the business was facing insolvency.
The business owners were referred to our team, eager to find a way to save the business.
Summary
Established café
COVID-19 impacted | Main debt owed to the ATO
Outcome
An agreed 75% reduction on debts
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