What are the key benefits of corporate simplification?

When things become tight and you find that your business is heading for significant financial problems, it is important to search for functional methods of scaling down.

Corporate simplification is a simple and effective way of reducing operating costs after a practical assessment of exactly what is coming into the business and what is going out.

But how exactly does the process work? What are the central benefits and potential pitfalls? Moorfields investigates the key methodology behind corporate simplification:

Cutting your cloth to suit your needs

If you have built up a number a number of different strands to the company over time, it may be worth considering whether these are all now functioning properly and fulfilling their purpose. Dissolving any strands of the business that may have been created during potentially more buoyant times could be a simple way to downsize. Detailed analysis of every area of the business will allow you to assess performance levels and whether you are now too big for your own needs.

Maintaining momentum

It is critical that any corporate simplification strategy which you introduce allows you to maintain momentum rather than halting you completely. If this is the case, such a tactic may be counter-productive and actually not worth introducing. Ensure that your changes are planned in detail with this in mind. Cost savings, whether they are direct or indirect, could be considered both sensible and necessary for a company that is going through a difficult period. Such measures may ensure that your business once again becomes sustainable and could essentially be the difference between success and the ultimate failure.

Insolvency practitioners

An insolvency practitioner can assist business leaders in identifying and implementing solutions in terms of finance, recovery and risk management. We specialise in providing practical solutions to the numerous financial problems that can arise in the current financial climate.

If you would like to have a free no obligation chat with one of our advisers please call us on 0207 186 1143.