Marketing essentials in accordance with Statement of Insolvency Practice 16
Marketing a business is an important element in ensuring that the best available consideration is obtained for it in the interests of creditors and will be a key factor in providing reassurance to creditors.
Any marketing should conform to the following:
- Broadcast - the business should be marketed as widely as possible proportionate to the nature and size of the business - the purpose of the marketing is to make the business's availability to the widest group of potential purchasers in the time available, using whatever media or other sources are likely to achieve this outcome.
- Justify the marketing strategy - the statement to creditors should not simply be a list of what marketing has been undertaken. It should explain the reasons underpinning the marketing and media strategy used.
- Independence - where the business has been marketed by the company prior to the insolvency practitioner being instructed this should not be used as a justification in itself to avoid further marketing. The administrator should be satisfied as to the adequacy and independence of the marketing undertaken.
- Publicise rather than simply publish - marketing should have been undertaken for an appropriate length of time to satisfy the administrator that the best available outcome for creditors as a whole in all the circumstances has been achieved. Creditors should be informed of the reason for the length of time settled upon.
- Connectivity - include online communication alongside other media by default. The internet offers one of the widest populations of any medium. If the business is not marketed via the internet this should be justified.
- Comply or explain - particularly with sales to connected parties where the level of interest is at its highest, the administrator needs to explain how the marketing strategy has achieved the best available outcome for creditors as a whole in all circumstances.
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