Paralaw
The challenge
A late payment from a major client left Paralaw unable to pay a very substantial tax bill. When we arrived on the scene, the company was in administration and facing the very real prospect of liquidation.
A huge achievement
When we helped one of our clients sell their company for several million pounds, it was an even bigger achievement than usual. In fact, it was truly monumental. So, here is the story of one of the greatest corporate turnaround successes we have ever been involved in – which also contains some critical financial lessons for your own business.
A few years earlier…
It was 2011 when we first met one of Paralaw’s former owners, Murray Duncan, and his co-directors. Just months ago, the paralegal services provider had seemed like a growing and profitable business, until a delayed payment from a major client left them unable to pay a substantial tax bill.
The company was placed in administration, which could have easily been the beginning of the end for Paralaw. But rather than go into liquidation, they entered into an agreement with HMRC: they would be allowed to repay their bill in increments on the condition that we took over their financial management.
When we got involved, however, we soon realised that there were significant financial problems lurking in the woodwork. The business had no forward-looking financial information such as cash flow forecasts, monthly management accounts, budgets, or even a work-in-progress document. Essentially, they had no financial oversight of their business whatsoever – which is why they got into so much trouble.
We still believed we had a good business
“It was a super stressful time,” recalls Murray. “We had put so much time and effort into our company, and so had our staff. It was upsetting to think that it could all end just like that. But we still believed we had a good business and wanted to continue trading.”
Implementing robust systems and processes
We immediately put in place all the financial systems and processes that a company turning over close to £2 million should have as a matter of course. This made it easier to spot problems in advance and plan for future growth. And we worked closely alongside them, providing all the strategic advice and guidance they needed to make good financial decisions.
The impact was almost immediate.
Previously, the directors had spent most of their time fighting financial fires. “We were stuck dealing with complications that should not have existed, and only happened because we didn’t have a proper finance function,” said Murray. “Now, we were free to focus on what we were good at – keeping clients happy, not finance.”
Happy business, happy people
With their business in a much better place, the directors were happier, too – and not only because their growth went through the roof.
In the years before it went into administration, Paralaw was hovering at a turnover of around £1.4 million to £1.6 million a year. Over the next 10 years, however, the business grew consistently by 15-18% a year.
15-18%
growth every year over the next 10 years
15-18%
growth every year over the next 10 years
Happy business, happy people
With their business in a much better place, the directors were happier, too – and not only because their growth went through the roof.
In the years before it went into administration, Paralaw was hovering at a turnover of around £1.4 million to £1.6 million a year. Over the next 10 years, however, the business grew consistently by 15-18% a year.
Testimonials
Invest in your business today
Ready to step up, invest in your business and reap the benefits?
