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Lionshare Capital

Financial Crisis Management

Overview

Turn What-if to What-Now

If your business is facing uncertainty, considering several different “what-if” scenarios and coming up with a plan will be critical to business survival.

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During a financial crisis, business owners must make tough decisions to determine if they should move full steam ahead, pause, reorganize or re-open after an extended period. Are you making decisions based on your gut? Now more than ever, it is important to have the data at your fingertips to be making the right decisions. Regardless of how much you anticipate the impact will have on your business, a budget will help you navigate this financial crisis. Use this time to "Sharpen the Saw." Eliminate system errors and inefficiencies, streamline financial system operations and processes, re-focus and train staff, and have a better way to run your business.

Here are just a few what-if scenario questions to ask yourself as you develop different scenarios:

  • Time to recovery: Think about how the world will recover from the current economic crisis. Will businesses open slowly? Or will it take time?
  • Impact on sales: If sales go down 30%? What do we do with payroll and expenses? What if they go down 50%, or 70%? What then?
  • Length of crisis: What if the downturn lasts two months? What if it lasts six months? A year?
  • Impact of social distancing: How long will social distancing have an impact and how long will it last? Does that impact your business?
  • Financing options: Can I get an emergency payroll loan? How does that impact the numbers?
  • Scarcity: Will key inputs (such as raw materials for assembly) be scarce? What if their price goes way up and availability way down.
  • Retaining your workforce: How long can I keep my people without having to let people go. What will be the cost of letting somebody go when it includes recruiting and retaining a replacement later when the economy recovers? Would an overall cut in payroll be an acceptable compromise? Should the executive team take a cut first?
  • Cutting expenses: Which of my expenses are truly discretionary? How much damage does each cut do? 

The difference between the companies that survive a crisis and those that don't? Focusing on cash flow. Stick to the data. If you don't have a forecast. Now more than ever, managing your cash flow is the lifeblood of keeping your business on the right path. Start with your cash flow forecast - your projected sources and uses of cash, then revisit cash flow best practices. You'll be able to navigate the road ahead and recover more quickly. See how you can 'Put Your Numbers to Work' by creating a monitoring system for leading indicators and learn how to read your KPIs to make data-driven decisions. Cut ‘below the line’ costs first and then review ‘above the line’ people. Who is irreplaceable? Who to furlough? Don’t forget to play offense. Get better by ‘sharpening the saw’

Services Include:

  • Financing and Capitalization Plan
  • Cashflow Forecasting
  • Scenario Analysis
  • Business Dissolution Review
  • Financial Forensics
  • Government Programs
  • Occupancy Issues
  • Board Governance