The COVID-19 pandemic is blowing businesses into unchartered waters. Current economic and credit conditions have reinforced the need for proactive cost reduction and cash management initiatives.
In order to weather the COVID-19 storm, businesses need to identify new ways to compete, improve their bottom line and optimize cash flow levels. This includes changing from a tactical approach to instituting an ongoing expense management strategy.
Adept Advisory is a proud member of the COBRA (Covid Business Rescue Assistance) War Room, instituted as a pro-bono service to South African businesses in financial distress – as a result of coronavirus and/or other factors (www.cobra.org.za). The intention is to aid society, where we can, in a positive way. Amongst platform services being rendered, Adept Advisory has committed to contributing expertise on value creation, through a combination of our Expense Management, Working Capital Optimisation & Cost Recovery solutions.
These solutions seek to derive a multitude of benefits for businesses, ranging from targeted spend & innovative saving initiatives, optimised contract structuring, to minimizing reliance on external borrowing.
Ultimately, business value is earned by working 3 key levers:
- Profitability – revenue generation in excess of expenditure (vis-a-vis earnings multiples);
- Liquidity – available cash to service short-term debt (vis-a-vis discounted cashflow);
- Market sentiment – investors’ perception of inherent asset value (vis-a-vis intrinsic value).
If these levers can be pulled and pushed in a well-structured and coordinated manner, value is created.