Working With a Turnaround Professional to Save Your Business


essence-tmLike most turnaround groups, Revitalization Partners have a difficult time getting some of our clients to talk to us about our work.  

While we’re in the process of attempting to save a business, the owner is usually too upset or emotional to focus on the work that needs to be executed. 

After the business is saved, and things are back on track, the owners/managers just want to forget that they almost lost everything.


A Totally Different Mindset …

As Joel Getzler, a New York based turnaround professional stated: “It’s one thing to run a company when things are going well; it takes a totally different mindset when things aren’t going well.”

Even though the economy is doing well, things are not going as well for thousands of smaller companies.  Revised banking regulations have impacted banks’ ability to loan to companies with marginal or no profits.  As a result, banking relationships that many businesses have relied on for years are in the process of being sundered.

An Entrepreneurs’ Unshakable Optimism …

optimismWe have discovered that most entrepreneurs’ unshakable optimism is one of the most difficult factors in saving a troubled business.  Most entrepreneurs believe that “it will get better tomorrow”.  

Or if we just fix this one problem, everything will be OK.  Neither of these is ever true.  The exact optimism that got them to where they are is a serious detriment when the business begins to have problems.

One Of The Major Things …

One of the major things that a turnaround professional can do is to help you buy time with your bank and to find you a new lender.   An optimistic entrepreneur is almost always certain that if the bank just understood how good things were going to be in the future, they would want to keep the company’s business.  And nothing is further from the truth.

LloydBlankfeinLookingSkepticalThe bank, in most cases, has heard the stories and projections.  And in most cases, the projections have been missed in the past. 

Credibility on the part of the company is now poor and the bank has made its decision.

The important thing is to present the company in a way that will be favorable to a new lender.  Our experience is that most owners/managers become so focused on what they think is important; they have difficulty seeing the company from the bank’s perspective.

One of our clients, having lost money for several years, was told by their bank that they needed to find a new lender.

An Unnecessary Waste Of Time …

They received the notice in Month 1, but because of the optimism, did not really Wasted-Time-300x330believe the bank would actually revoke their loans.  In Month 4, when they received the final 30 day notice, they finally asked for help.  While being successful in finding them a new lender, it has taken well into Month 8. 

Without third party credibility and new very detailed financial projections that the company was able to meet, the bank would not have extended the loan, nor would a new lender have been interested.

Not Sudden Incompetence …

Business owners and managers don’t suddenly become incompetent, but too often they fail to realize the rapid changes affecting their business.  And banking regulations are one of these major changes.

SelfDelusionWe recently had a client where, for the first time in the history of Revitalization Partners, we had to resign from an assignment.

The client, an absentee owner, had borrowed a significant amount of money personally to keep his business afloat and had very distinct ideas of what needed to be done in the turnaround.  Despite significant continuing losses and almost no working capital, he would not understand that his optimistic plans were unfounded.

A turnaround process can sometimes be long and painful, especially if you’ve spent years building a successful business.

If Only You Had Called Sooner ….

It’s important to talk with a qualified advisor as soon as you think there may be a problem.   Many companies could have been saved if the optimistic entrepreneurs had asked for advice earlier.  We repeatedly hear from clients that: “I wish we had called you sooner.” Honestly, so do we.

Choose advisors that you and the financial community trust and are comfortable communicating with. Make certain that the group you work with has been highly successful in working with banks and finding new lenders.

Once you have selected a professional advisor, be prepared to take their advice and follow the steps they outline.   Your business depends on it.