October 24, 2021
Want Your Company to Succeed? Make Sure You Cover These Two Bases

Want Your Company to Succeed? Make Sure You Cover These Two Bases

Pat Brennan has seen a few things when it comes to why businesses fail or almost fail, to put it mildly. He’s a National Turnaround Association award winner specializing in financial restructurings at the Platinum Group, a business advisory that helps business owners and leaders navigate out of tough situations. Sometimes a business is too far gone by the time it contacts Platinum and when that happens, Pat’s brought in to discuss ‘what now?’ And that usually means insolvency and sometimes bankruptcy.

He was recently asked, based on all the “too late” cases he’s worked on, what is the number one most frequent issue that tripped up a company?

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“Lack of integrity in their in their financial statements. They were not telling what was really happening. It may be a misstatement in inventory, where they may think they have $3 million of inventory but they really have only $1 million; something very simple like that. Or there’s the unforeseen loss of a major client and suddenly they have that aha moment where the client goes away. It’s a variety of things. It doesn’t have to be just one. They can all fit together. And it takes just one to disrupt the cash velocity of the business—the speed at which a dollar flows through the business.”

Given today’s Covid-19 recession, I asked also him, “What should business owners and leaders be focusing on if not already doing so, given what you’ve seen from so many companies that have come to you after it’s too late?”

“There’s so many disruptions and so many unknowns today. I think it’s really having a great situational awareness of your market, your cash flow and developing a horizon from which to plan that goes out 90 days. We don’t know if we’re going to have another resurgence of this virus and if it’s going to cause everything to shut down and have folks go home,” he said. Then there’s where the economy is really at: “There’s been an injection of working capital from the government through these PPP funds so companies are artificially propped up. They have filled their coffers and when that money runs out really is going to be the day of reckoning [economically]. So for your business, what is it going to look like for you in 90 days and get ready. Make decisions today that you may wish you had made 90 days from now.”

Pat and I discuss these and other issues during a brief interview that can be watched on YouTube or listened to/downloaded from either Spotify or Apple Podcasts.

PG-Logo-RGBOur interview is one of a series of short talks I’m having with various members of Platinum Group, which over 40 years has helped more than 2,000 companies deal with extreme challengeOpen_colorReels including financial setbacks, lender/landlord re-negotiations, turnarounds and bankruptcies. (*See footnote below.)

All Platinum Group interviews are recorded in one take with no edits, and can be found on YouTube and also on Apple Podcasts and Spotify. Other interviews include:

  • Founder and Chairman Dean Bachelor (perspective and strategy) video or podcast
  • Partner Robert Lehmann (real estate law, early stage financing) video or podcast
  • Partner Randy Kroll (leadership and accounting) video or podcast
  • Partner Bob Stewart, (how to be decisive despite uncertainty) video or podcast

 

anchorOneTakelogoThe Platinum Group interviews were done in relation to a series of “One Take CEO Interviews,” unedited, short discussions on how business leaders are dealing with all of today’s economic and health-related uncertainties. These are available on You Tube, and also on Spotify as well as Apple Podcasts. Episodes include:

 

* This content was paid for by Platinum Group.

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