An Independent Business Review (IBR) is typically carried out by an insolvency practitioner on behalf of stakeholders, banks or lenders concerned about the financial position of a company. The process involves thoroughly assessing financial health, cash flow, profitability and overall performance to highlight any risks posed by lending to or working with the company in review. However, despite offering obvious benefits to external stakeholders, there is growing recognition that businesses can proactively benefit from an IBR.
Not sure how an Independent Business Review could benefit your business? Fear not, we’ve outlined the five key benefits in this blog post.
Properly Understand Strengths And Weaknesses
When you’ve worked in a business for some time, it can be easy to look at performance through rose-tinted glasses. An Independent Business Review, on the other hand, can be a great way to get an impartial and outside perspective on your company’s strengths and weaknesses. This more objective and outside opinion might reveal obvious failings or areas of improvement that you haven’t thought about before, offering invaluable insights for strategic planning and allowing you to address weaknesses before they escalate into a bigger problem that may hamper profitability and competitiveness.
Meet Compliance Requirements
While it’s true that IBRs are requested by banks and lenders to assess the viability of a business, proactively obtaining an IBR can help companies meet regulatory requirements. Many businesses are subject to specific regulations or required assessments of financial stability and operational practices. Conducting an IBR adds another layer of security to these, making it obvious that your business is prepared to adhere to regulatory standards. This not only avoids potential penalties but also showcases a commitment to transparency and responsible business practices.
Build Trust With Stakeholders
An Independent Business Review can also help you to build trust with your stakeholders and improve significant relationships. Of course, stakeholders may request that an IBR be conducted themselves if they deem your business to be in trouble, but being proactive and requesting one yourself can send out positive messages to possible investors, customers or suppliers and demonstrate that you have a positive culture that deems continuous improvement important. Positive findings will also assure stakeholders of the company’s financial health, building confidence and increasing the chances of relationship retention.
Assess Competitiveness
Staying competitive is a vital element of business success, particularly as we look towards a new year that is tipped to pose its fair share of challenges. An IBR is hugely beneficial on this front, as it will usually include an analysis of your competitive position and benchmark your results against other businesses operating in the industry. These insights can be valuable moving forward and ensure that any improvement strategy you may wish to embark upon is relevant to current market conditions.
Make Informed Decisions
Ultimately, all of the insights revealed by an Independent Business Review help you to make informed decisions. Whether considering a growth plan, merger, acquisition, or operational restructuring, accurate and up-to-date information is vital to ensure that the decision you make is the most suitable one. An IBR provides your business with this information in a clear and comprehensive format, giving you the tools you need to carefully weigh up your options and minimise any risk that may be associated with important changes.
How To Get An Independent Business Review
If you think an Independent Business Review could be a worthwhile exercise for your business, you will need a third party to conduct the review on your behalf. Insolvency practitioners are well suited to this work due to their experience working with financially distressed and insolvent businesses.
The expert team here at Ballard Business Recovery are qualified and ready to help with your Independent Business Review. We have extensive experience helping lenders and charge holders ensure their security, and in working with businesses to help them improve or recover from financial difficulty. Get in touch today to find out more about our service.
