Business Closure or Downsizing

In today’s business climate, downsizing and business closure have become common and important strategic management activities to increase competitiveness and eliminate redundant capacity. Downsizing should be viewed as a natural progression in the development of businesses, not an exceptional or unusual activity. However, the gains of business closure and downsizing could be lost if the right processes are not engaged during the exercise.

What are the issues?

There is a desire to exit an underperforming or non-core business unit or subsidiary. Management may lack experience dealing with business closures and requires support and assistance with closure or downsizing initiatives.

How can we help?

We bring hands-on experience in winding up and closing businesses by helping you assess, develop and implement a closure plan. Our business closure and downsizing services include:

• Evaluation of the merits and risks of available options, including turnaround, sale and managed closure
• Assistance in formulating an exit strategy and developing a closure plan considering, among other things, contractual commitments, commercial consequences, operational risks and overall financial impact, including exit costs
• Project management of the closure plan, including advice on negotiating contract termination settlements, managing activity levels to reduce costs, advice on employee consultation and redundancy programs, sale of residual assets, mitigation of contingent liabilities and monitoring of performance against key milestones
• Assistance in finalizing accounting and tax issues.

Expected Outcomes

Working with you to develop suitable solutions, we expect the following benefits to accrue to your business:

• The turnaround or exit of underperforming or non-core businesses reduces the strain on your company’s resources and improves overall financial performance.
• Outsourcing the project management of the closure process allows management to focus on its core business and strategy.