How to stabilise a business before formal business rescue
CJ Dicks · South Africa · Stabilisation
Before a formal process begins, the business needs a clear picture of cash, pressure points and the few decisions that can still change the outcome.
Start with cash visibility. Not the optimistic forecast, but the next few weeks of inflows, outflows, creditor pressure, payroll, tax and commitments the business has already made.
Then separate what must be preserved from what must be stopped. Stabilisation usually requires fewer priorities, sharper communication and a willingness to stop work that looks important but does not protect the business.
If formal business rescue becomes necessary, the leadership team should enter it with the clearest possible view of viability, creditor position and what a realistic rescue plan would require.
Sources and context
- Companies Act 71 of 2008
- CIPC business rescue information
- IoDSA King IV Report