Neil Honess, a partner at KPMG Canada, is the head of the firm’s deal advisory, restructuring and turnaround group in Calgary. Wil Andruschak © Postmedia Network Inc.
Joel Schlesinger © Postmedia Network Inc.
The global economy will continue to face challenges in the short and medium term, and accordingly, there remains significant uncertainty.
Calgary firms are facing “an out of the frying pan into some sort of fire scenario,” says Neil Honess, partner at KPMG Canada.
Simply put, many businesses don’t know what to expect.
From the impact of COVID-19 variants to the prospect of a strong economic recovery and the removal of stimulus programs such as wage subsidies, the future has never appeared more up in the air.
Businesses can make their operations more resilient and flexible so, no matter what comes next, they can roll with the punches and be profitable, Honess says.
The head of KPMG’s deal advisory, restructuring and turnaround group in Calgary should know. He has plenty of experience helping companies make the necessary changes to overcome big, often existential, challenges.
To that end, Honess and others on his team at KPMG in Calgary — a full service audit, tax and advisory firm owned and operated by Canadians — have been busy over the past several months preparing organizations for what comes next by helping them focus on better cash flow management along with more efficient allocation of working capital.
“We’re having conversations with our clients about the steps they could take to put themselves in a better position in uncertain times, including for what happens when stimulus is reduced and eliminated as the pandemic fizzles out.”
Minding cash should be job No. 1 for all companies, he adds.
While that may sound self-evident, only the most successful companies are adept at managing cash flow and allocating working capital to be able to change course if economic conditions take a sharp turn.
“The problem is a lot of companies don’t do that,” Honess says.
Organizations are likely to face different challenges in the coming months than those they have experienced during the pandemic, including rising borrowing and payroll costs. Without managing cash and working capital, they may not be able to react in the most effective way to these changing stresses. Companies that plan to manage their cash flow and working capital efficiently are often successful no matter the economic conditions.
Indeed, that’s the experience of many of KPMG’s clients, Honess adds.
“Every company that prioritizes cash management, benefits,” he says. “The very best companies always build preparedness for the unexpected into their business models.”
This story was created by Content Works, Postmedia’s commercial content division, on behalf of Calgary Economic Development.