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What to do with a declining business?

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Is your business declining?

There are times when products begin to decline due to varied reasons. Advances in technology, lifestyle changes, and changing customer demographics are a few of the reasons that create declining markets. During this period, businesses need to make a critical decision as to whether to liquidate or divest. Some companies end up forgoing profits to support declining products, which can be avoided with appropriate marketing strategies to increase sales and profits in a declining market.

At Apex Advisors Chartered Accountants we provide advice to small businesses in decline in the Southern Highlands and South West Sydney.

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Signs that your business is not well

• Taking longer to collect payments from debtors

Extending lines of credit to customers

• Overdraft facilities are constantly under pressure  

Increasing borrowings in order to maintain the business

• Having poor control over costs

• Increasing your range of suppliers simply to get more credit

• Stock levels are rising but sales remain stagnant

• Behind with your ATO obligations

• Receiving final demand notices

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Time to make changes

The first step is recognising the need for a change. Developing and implementing a turnaround strategy is the best way to return your business to acceptable levels of profitability, liquidity and cash flow. This can be a difficult task and business owners will need to address the problems.

The process of turning around a business includes;

1. Making a realistic assessment based on the current situation and engaging  stakeholders

2. Getting comfort that there is a business worth saving

3. Investigate options and scenarios

4. Develop and implement an action plan

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Work with Apex Advisors

When it comes to declining businesses you need to act quickly and with the right advice. Apex Advisors Chartered Accountants have experience in helping businesses navigate the challenges facing declining businesses. Whether you are in Mittagong, Bowral, Moss Vale, Camden, Picton, Narellan or Campbelltown get in touch with us today.