Company Reorganization

What is business reorganization?

Reorganization, or business restructuring, is a process where a company does an overhaul of its current strategy, setup, and operations. Typically, businesses go through reorganization when they have financial troubles, new owners or staff, or a structural change. When a business reorganizes, it generally changes its business tax structure.

In addition to a tax structure change, businesses that reorganize may change up their marketing strategies, staff, products or services, or business name.

If your business is struggling, don’t ignore the warning signs. A successful company restructure can result in increased profits, operational efficiency, and debt paydown.

However, business reorganization efforts don’t always work. Ineffective reorganization may lead to bankruptcy. And, businesses that go through bankruptcy reorganization might end up going through liquidation.

Reorganizations might be voluntary or mandatory, depending on the circumstances.

Types of business restructuring


There are a number of reasons a business might go through reorganization. Three common types of restructuring include:
- Identity or management
- Bankruptcy
- Mergers and acquisitions

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