Change management

What we do

As Herakleitos (BC 535-475) said “The only thing that is constant is change”. Companies need to change or adapt to forced changes for not only growth but for their very existence. Change could be triggered by technological advancements, arrival of new generation or competitors

When you compare the Fortune 500 list back in 1950s and today you will notice that over 80% of the companies do not exist. They have either gone bankrupt, merged, or still exist but have fallen from the top Fortune 500 companies. One of the eye-catching examples is Home movie and video game rental service giant, Blockbuster Video, which was founded in 1985 and arguably one of the most iconic brands in the video rental space. At its peak in 2004, Blockbuster employed 84,300 people worldwide and had 9,094 stores. Unable to transition towards a digital model, Blockbuster filed for bankruptcy in 2010. In 2000, Netflix approached Blockbuster with an offer to sell their company to Blockbuster for US$50 million. The Blockbuster CEO, was not interested in the offer because he thought it was a "very small niche business" and it was losing money at the time. As of September 2018 ending twelve months, Netflix had 137 million subscribers worldwide and revenue of US$14.89 bn. (https://www.collectivecampus.com.au/blog/10-companies-that-were-too-slow-to-respond-to-change)

Naomi Klein’s book The Shock doctrine-the rise of disaster capitalism is basically a heavy critic to Chicago school economic doctrine, which is advising radical changes to the economic and social system of the developing countries using shock therapy. Reserving the devastating effect on people or on an entire country this approach could be adopted to business environment. Corporations could find an opportunity to change during financial crises or arrival of new kids on the block. For instance corporations usually respond to financial crisis first by layoffs and/or other measures that mostly have declining effect on turnover with the hope of increasing profitability. However corporations are like heavy trucks; it could take much effort, energy, and money to accelerate after holding the breaks.

Change management ensures change initiatives produce the intended results. We can help you climb on a tree and look down to your corporations with a new & unbiased pair of eyes and assist you to plan, implement and collect the fruits of the change in your companies.

Cash flow management

Cash flow management

Well-established institutions may not have sophisticated systems to manage their cash flow but arguably most of them know the significance and therefore allocate resources to manage their cash flow on daily basis. However small businesses and start-ups on the contrary do not have both knowledge and time to concentrate on their cash flow and although they have a business with good margins and growth potential they struggle as a fledgling business and sometimes even cease to exist. Business insider suggests cash flow (82%) as one of the top reasons small businesses fail.
https://www.businessinsider.com/why-small-businesses-fail-infographic-2017-8

We can help you to analyse your cash cycle and balance your capital & debt for sustainable and healthy growth. Some entrepreneurs try to avoid debt and neglect the value of their capital. Others turn their companies heavily indebted eating their margins. Best example is buying a house with a mortgage. Lets assume you can get 50% of the value of the house as a loan where by the value of the house USD 250’000 and you have USD 250’000 in cash. Debt avoider missed the opportunity to buy two houses by investing all her cash to one house and the debt lover uses all her cash to buy two houses and do not calculate the negative impact of the interest payments at her cash flow. The best option could be finding houses of USD 200,000 value and both try to ease the burden of the interest payments and also keep USD 50,000 cash for rainy days. Of course this is a very simplistic example but the point is put your cash flow on top of the list before taking business decisions. We can help you in finding the right approach to cash flow management hence a healthy business.

Corporate structure

Corporate structure

You found a business long years ago and it grew in to different directions including international sales or totally different industries. Some owners manage different businesses under one single company and loose time in divesture when some one approaches for taking over one part of the business. Businesses sometimes choose to set up new ventures when their older structure no longer meet their needs or their expansion is at a limit.

International sales for instance could also bring various opportunities such as founding a company in a jurisdiction in order to penetrate more in to local market. If you are selling to EU, having a company in EU you can import the goods yourself and have the opportunity to sell in smaller lots but with higher margins.

We can help you incorporating companies in your export or import markets reforming your corporate structure and increase your bottom line

Trade and commodity finance

Trade and commodity finance

Commercial debt is usually secured with mortgage, checks and notes etc. Commodity itself is hardly used as a security by local banks. Where as some international banks have a special division as trade and commodity finance mostly under wholesale banking.

Commodity finance is a type of lending that fits into trade finance and is actually split into three groups of commodities, which are metals and mining, energy and soft commodities. A commodity is a basic good used in commerce that is interchangeable with other commodities of the same type.

Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade

Grain, olives, coal, ferrous and nonferrous metals are some of the commodities that are financed by banks holding these commodities as security. Banks breakdown their lines subject to the security they have; 5 million against mortgage of the factory building, 3 million against customer cheques, 1 million name lending (signature of the owner/s). So total line is 9 million and it seems value of the factory or the size of customer cheque portfolio will not increase in near term where as you need additional limits to grow your business or catch high profit potential business. You can unlock this limit on credit lines if you have a commodity-based business. We can help you structuring a commodity-based credit line and therefore unlock growth potential and profitable business opportunities.

Project finance / Deal assistance

Project finance

Closing a deal could involve various parties of which coordination of the communication and completing the documentation could be very time consuming. Let’s say there is deal about sale of a 6 motor vessel fleet. The parties would be the financier of the seller, the seller, buyer, financier(s) of the buyer, the flag and registry jurisdiction of the buyer, the flag and registry jurisdiction of the seller and finally lawyers from each party. Moreover every MV is a sole company. Therefore although it is one deal actually the documentation is six fold. All parties desperately needs someone who would speak the language of the lawyers, financiers and the business people at the same time in order to make sure the documentation is in order and all the authorised signatures are in place. We could be your answer to that needs in order to minimize the time and therefore the cost in order have successful closing.