While a business rescue advisor usually enters the picture at the point where a business is struggling often they can trace financial problems back to its early days.
Setting up a business is not easy, even for the formerly successful executive coming out of a big business, and often the advisor will identify structural problems that have been there since the beginning.
For a start-up, a major problem is the number of documents that have to be prepared, checked and approved, from the terms and conditions for clients, suppliers and a website, to the documents like a shareholders agreement, employment contracts and a staff handbook in addition to establishing robust back office with admin, record keeping and accounting systems.
Where the executive may have been able to call on both in-house HR and legal help and will have been backed by ample resources the start-up has no such in-house help. How does a new business owner assess the validity and worth of any advice, especially when he or she has to be careful about the cost of advice?
Then there is the problem of selling the business product or service. Some entrepreneurs are brilliant sales people, who give little thought to systems and accounts, while others are systems or financially oriented but with little experience of business development and selling.
While everyone encourages you to jump, if you are coming out of a big business intending to set up your own company you need to pause, reflect and find out what needs to be done before taking the plunge.
Our next blog will focus on how to find the right advice.
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