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Business in a Sinking Ship? Time to Get to Work

Many business lenders have been ‘recruited’ to the work out team. If a business is not in deep trouble yet, your bank’s workout team may not have time to work with them.

In the Turnaround Tactics article How to Patch a Sinking Ship, Marc Kramer  covers five areas he assessed when his start-up business was heading off course.
SinkingShip.jpgHere is a quick summary plus some of my thoughts. They are written from the perspective of the business management team so just shift the focus if you are assessing the management team’s efforts.

Value Proposition

  • Consider strengths and weaknesses of the company.
  • Have someone else survey current and past customers to see what they say is important. Don’t assume.
  • If you cannot afford to hire out a survey, consider someone you trust from another business and do the same for them.


  • Are they really winning or are they in the same shape as you are?
  • If they are winning, is it on price? Better marketing?
  • Are they winning short term but harming their brand or their opportunities for long-term success?

The Market

  • I loved Marc’s insight on this…Are we trying to sell to the market we wish wanted us instead of a market that really does?
  • I would add, is there a parallel market that we could serve?


  • What about the sales process is not effective?
  • What worked pre-recession may not have worked during the recession.
  • What worked pre-recession may not have been the best process anyway.
  • Evaluate and consider something different.


  • Right people?
  • Right positions?
  • Right number of people?

Read Marc’s entire article on How to Patch a Sinking Ship. Marc Kramer is an instructor at the Wharton School at the University of Pennsylvania and President of Kramer Communications, a company that develops business, sales, operating and marketing plans and Internet content strategies for Early Stage to Public Companies.

  • What other turnaround strategies have you seen work well?
  • How do you approach your business borrowers with these ideas so that you don’t offend them?
  • Any concerns about ‘lender liability’ by appearing to advise the business borrower?
About the Author
Linda Keith CPA is an expert in credit risk readiness and credit analysis. She trains banks and credit unions throughout the United States, both in-house and in open-enrollment sessions, on Tax Return and Financial Statement Analysis. She is in the trenches with lenders, analysts and underwriters helping them say "yes" to good loans. Creator of the Tax Return Analysis Virtual Classroom at, she speaks at banking associations on risk management, lending and director finance topics.