As the COVID-19 pandemic continues to impact businesses across Australia, the skills of professional insolvency and business restructuring practitioners are likely to be in demand. So, how should the sector respond?
1. Build a working capital buffer
The paradox of our current situation is that while many businesses are struggling and planning scenarios for significantly lower revenue – insolvency practitioners may see demand for their services increase. However, that doesn’t mean that doing business will be straightforward.
Practitioners may face a challenging time over the next few months. Insolvency and business restructuring work traditionally has long lead times between commencing work and getting paid.
With this in mind, it’s critical to ensure that your business has sufficient working capital, to survive through this time.
2. Become a trusted source for key information
There is no shortage of information circulating at the moment; the challenge for business owners is in trying to get a handle on what information is accurate and relevant.
Insolvency practitioners can differentiate by providing clear guidance for businesses that need support. Explaining the relevance and use of information, in ways that business owners and referrers can understand, will mean that you’re likely to be called upon for advice.
Businesses value relevant and practical information, so look to provide advice based on official sources – rather than just repeating information that is readily available online.
3. Reach out to your referrers
Referral partners are critical to generating new business, so maintaining relationships with those who refer business to you is crucial. An important step is to equip referrers with resources that they can share with their clients, to help them think through pressing issues like crisis management. Marketing yourself and your services will help keep you and your business front of mind. Your competitors will be taking advantage of this period to generate new business, so don’t forget to let people know what you do, and how you do it.
4. Position yourself as a business survival expert
Businesses will be impacted by coronavirus in a myriad of different ways and will often require different solutions. Flexibility will be key, and practitioners need to consider a broad offering for businesses looking for restructuring or insolvency support.
With the introduction of stimulus packages, business owners don’t need to rush into making difficult decisions; they can take time to assess whether they are likely to emerge after the crisis ends. However, insolvency practitioners can offer consultative services, helping owners and directors understand the options available to them.
Moving out of formal outcomes and assisting with advice, negotiation, and handling communications may be very valuable during this time. Discussions with stakeholders, such as creditors, landlords, suppliers and employees can be challenging, so being available to support in these conversations can help to position you as a trusted adviser.
5. Equip your staff and your business to act as consultants
To act effectively as crisis consultants, business leaders need to ensure their staff have the skills and knowledge to work collaboratively with clients. This may require training and development of staff to conduct consultancy work.
If your employees are working remotely, it’s even more important to ensure close collaboration across the business and with clients, maintaining consistency and communication.
That also means setting up your accounting systems to track and bill for client consulting work that may fall outside your existing business model; as well as communicating with, training, and keeping staff up to date with key issues and changes in the law.
How Macquarie can help
The Macquarie Insolvency team is here to help you with personalised support, delivered by industry specialists.
To find out more, contact your Macquarie Relationship Manager, call 1800 442 370, or visit macquarie.com.au/business-banking/insolvency-industry.html
We also offer innovative business integration services; integrating with Insol6 and CORE IPS, to bring you a faster, more efficient way to manage billing, payments, and reconciliation, while reducing the risk of keystroke error for your firm. Contact us to find out if your business management or accounting software is compatible.