How to save a company

How to save a company from bankruptcy? There are many reasons for a company to go bankrupt, but there are ways to get out of it, such as increasing sales, using web marketing and specialists.

Reasons for the difficulties faced by companies

There are many reasons why companies find it difficult:

• Loss of market due to competition from web-based companies
• New competition
• Loss of major cash-cow customers
• Changing consumer behavior
• Departure of some key employees
• Heavy tax penalties for past mistakes
• Outdated human resources
• Obsolescence of production equipment
• Failure of a major project

There are many reasons for this, and in these cases, a non-decision is a decision: every day that goes by without doing anything is a step towards closing the business or putting employees out of work.
The means to get the business back on track can be divided into two: increase revenues, or reduce costs and increase efficiency.

How to save a business from bankruptcy: increase revenues

Increasing revenues is the most difficult solution, but also the most rewarding in the long term, and the best chance of revitalizing the business in the long term. Here are a few ways to do it:

• Find new markets using the Hansoff matrix
  • Current market – current product with sales force
  • Current market – new product
  • New market – existing product
  • New market – new product
• Train the sales force to increase efficiency
• Launching an e-commerce website
• Boosting sales through web marketing is currently the most effective solution for the majority of companies who are losing market share due to a lack of visibility on the web.

Reduce costs and increase efficiency

Cutting costs is complementary to boosting sales, but it must not be done in such a way as to destroy the company in the medium or long term. This is the solution of bad managers who cut, but in the wrong place.

• Restructuring by cutting out money-losing sectors
• Cut salary costs, either by reducing salaries or cutting staff.
• Replacement of production equipment with high-performance equipment
• Improving management methods. Many SMEs would do well to consult turnaround specialists such as Pierre Roy et associés, while they are still in good financial health.

Conclusion

At times, no matter how good the management team, you’re too close to the problem to see all the different aspects. To save the company from bankruptcy, it’s best to consult specialists, at least to get their opinion. It’s also courageous to recognize it or do it.

Jean-Pierre Mercier
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