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Thread: Financial Challenge

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    Talking Financial Challenge

    My company is beeing operating for 15 months now and has a soft loan of 2.1m from sponsors of SLP project. Our turnover is currently 2.2m. We never reached a break even point from 1st month and we are now sitting at a net loss of 800 000 ofwhich 500 000 is owed to creditors. How do we avoid company closure for benefit of shareholders(communities)

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    Diamond Member AndyD's Avatar
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    So you received start-up capital of 2.1mil, operated for 15months, turned over 2.2mil and made a net loss of 0.8 mil. How come your company losses are 36.5% of your turnover. This is a staggering set of figures, I'm not a lawyer but the destiny of this company is probably out of your hands, I suspect one of your creditors will apply for your company to be liquidated very shortly.

    Why are the losses so high? Was this a long term venture that requires more time to become profitably? I don't see how a business with 2.1 mil turnover in 15 months could possibly have run at such a loss.

    Welcome to TFSA by the way ATM.
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    Thanks Andy

    This was a long term venture aimed at job creation and empowering communities.
    The 15 months was mentorship program and participating directors/shareholders are not competent business people or maybe this was just another money scam in the name of helping previously disadvantaged.

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    Diamond Member AndyD's Avatar
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    Quote Originally Posted by ATM View Post
    or maybe this was just another money scam in the name of helping previously disadvantaged.
    I'm sure you would be in a position to give judgment on that.

    Is this company a charity NGO / NPO? What kind of turnaround strategies have you implemented to date? Can you give more details as to how the company is structured?
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    Site Caretaker Dave A's Avatar
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    I agree with Andy - it's hard to advise without further information.

    One question that struck me - How much capital did the shareholders put in?
    The trouble with opportunity is it normally comes dressed up as work.

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