Workouts: It Adds Up, Do The Math, It’s Basic Arithmetic

Friends, it is not all that confusing. You simply must do the math.

If your business revenues have been reduced so significantly that you cannot make further adjustments to the model and you are still losing significant amounts of money every week (month/quarter/year), then you are in need of a debt workout. This is clear. There can be no confusion. It is what it is. Stop waiting for a mystical cure or a divine intervention. Accept the fact and then act on it, doing the only logical thing you can do–a debt workout. A workout that results in debt forgiveness and returns the business to liquidity, profit, and operating above break-even.

We are not done yet.

Now, figure the best possible debt workout there can be, remove the total secured debt monthly obligation and see if you are now breaking even or turning a profit. If removing the monthly debt service does not return your business to profitability, then your business needs to be liquidated or reviewed again for further downsizing and overhead reduction, forcing your business model into a profitable business equation.

That’s it, simple math. No emotional decisions, no unfulfilled dream issues, no ego involvement, just simple math. Force liquidity by downsizing and doing your debt workouts. If it creates profitability on paper, do it. If it does not, liquidate. Far too many business owners are hanging on to losing businesses, not downsizing deeply enough, not doing the debt workouts and losing money until there is no more left to lose and then dissolving.

Figure it out. Do the math.