Liquidity & Working Capital Stabilization

Businesses face an array of dynamic challenges, from regulatory impacts and virtual global competitors, to rapid technological advances, customer affinity changes and supply disruption. These dynamics can sometimes result in the loss of key customers, established market share, or revenue flow, impacting a company’s liquidity, working capital and current business operations. Responding quickly to liquidity and working capital distress – can make a significant difference in minimizing customer, partner and operational impacts and perhaps head off more complex restructuring steps. Phoenix’s Turnaround and Restructuring practice is geared towards helping companies quickly assess the key factors impacting liquidity and ongoing cash flow needs. Our specialists will rapidly identify the key issues impacting liquidity, including cash flow and revenue generation; key operational costs including inventory costs and turns, product or service costs, and overhead and SG&A; accounts payable and outflow issues; infrastructure and balance sheet issues; current debt service, and other key working capital impacts.

We will help model cash flow and operational working capital to determine how cash is being managed and disseminated. We will also help accelerate a near term plan of steps with company management to speed collections, slow disbursements, cut costs, and generate liquidity to ensure that critical customer, supplier and business operational impacts are minimized.

These activities are extremely critical and impactful as the generation of near term liquidity through internal actions is key to obtaining the time to:

  • Implement deeper operational and cost control measures
  • Evaluate strategic options and capital structure needs
  • Negotiate consensual solutions with creditors
  • Develop a Restructuring business plan if deeper capital restructuring or additional sources of capital are required

We can work with stakeholders to identify the debt and capital structure issues that are impacting current operations, evaluate strategic options, and determine future capital structure needs which are critical inputs to the development of a restructuring business plan and lender negotiations.