Strong Management and Good Advice Are Key to Survival
Despite forming the backbone of Ireland’s economy, owner-managed business are some of the most vulnerable in today’s economic climate. But these businesses, by their very nature, also tend to be in a position to respond quickly to changes in their circumstances which is why, with the right advice and the right people in charge, owner-managed businesses should be able to ride out the current storm and take advantage of any upswing which will inevitably come.
Kealy Mehigan Chartered Accountants has been providing targeted advice to individuals and businesses over the past 30 years, specialising in corporate recovery and restructuring for the owner-managed sector. And, according to David F. Mehigan, companies which receive the right advice, as early as possible, will be best placed to ensure their own survival.
We have a long track record of dealing with clients who may have found themselves in difficulty, he said. Maybe they received inadequate advice, maybe they had insufficient management systems, or maybe one of their main customers or suppliers got into financial difficulty. But whatever the reason for their difficulties, these businesses needed professional advice in both formal and informal restructuring in order to remain in business.
Mehigan identified strong management as key to survival management which can spot the early warning signs of trouble, both in their own company and in that of their key business partners.
Everybody is operating under cash flow constraints at the moment, he said. So every business manager needs to understand that the issue of a major supplier or a major customer getting into trouble is not necessarily very far away. Managers need to be aware of the financial stability of their key suppliers and their customers, and they need to understand their own exposure to these businesses.
There are a number of early warning signs that managers need to look out for, warning signals such as a supplier putting them under pressure to be paid when, in the past, there had been no such pressure; or a sales team from a supplier pressurising them to take on extra orders.
In these instances, managers need to take a second look at their client’s position, said Mehigan. It is a minimal cost to look up their most recent filings, and at the end of the day, you need to be protecting your own business. Of course, you don’t want to damage your relationship with a key partner, and you don’t want to put another company under pressure; but you have to protect yourself, and that should start with a meeting with the customer or suppliers management to discuss the situation. Let them know your concerns, and discuss how you might be able to work together to alleviate those concerns. And be looking around for new customers or suppliers in case your existing partners do collapse.
Founded in 1974 in Naas, Kealy Mehigan is a firm with nine staff members but it is also one of the longest established practices in Naas, with a history of dealing with the bloodstock industry and other professional firms. A general practice with specific expertise in corporate recovery and litigation support, it has dealt with a large number of businesses which have experienced difficulties over the past two decades, giving it the experience of having operated during previous economic downturns.
Thus, while the current business climate is not as positive as it had been two years ago, the professionals at Kealy Mehigan have the experience to recognise that, even in adversity, there are challenges as well as opportunities for businesses.
There are still good deals out there, said David Mehigan and, with careful and precise management, coupled with good advice, companies could be able to benefit from these new opportunities.