We see with concern how the deceleration of the economy in Chile is affecting the results of the companies, the investment and probably employment in the short term. Beyond the discussion, whether external or internal factors are impacting, the concrete fact is that today, many companies and entrepreneurs are going through complex moments. Reductions in sales, increase in expenses due to exchange rate effects, cash reduction, are classic examples of companies that are starting a process that requires a turnaround (restructuring).

The question is whether this scenario is a crisis or an opportunity? From our perspective it presents an opportunity. This is the moment in which the conviction of being an entrepreneur must be reaffirmed and it is necessary to make the decisions to ensure the sustainability of the business.

At Capital Fix Partners we make sure to accompany the clients in their turnaround process, in order to obtain the expected results. In broad strokes the process considers 3 stages; 1) Diagnosis: It is necessary that owners/management realize that the company is facing a complex scenario and if something is not done, the situation could get worse. At this stage, it is essential to understand what the variables that generate the operational/financial commitment of the company are (market, competitors, mismanagement, etc.). 2) Execution: The work plan is developed (6-12 months), which allows improving the operational and financial indicators of the company. 3) Leadership: The commitment of Shareholders, Board of Directors, Managers and workers is fundamental to the success of this process. Traditionally, it is a stressful process, with a lot of uncertainty. The communication of the turnaround process and achieving cross-cutting support for the measures that will be implemented is essential.

Ernesto Solís
Partner – Capital Fix Partners

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