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The Troubleshooter - its business and its personalCASE STUDY:
SITUATION
‘Furniture Co’ is an Essex based furniture manufacturer which produces hand made quality sofas for exclusive department stores.
The company was in complete distress. They had recently been party to a takeover by a group whose intention was to drive the company into the ground in order to asset strip and realise value post an insolvency process.
The previous company owner had remained in charge primarily through fear as he had invested all of his life savings approximately £200,000 into the company and was tied into personal guarantees on the premises which would see him lose his home if the company was to fail. The owner also had a heart condition, stress and in our opinion had been taken advantage of.
ANALYSIS
The analysis was not good. The company had been suffering for many years and had no effective sales and marketing strategy to increase sales. This had left them with only 3 large customers, one of which knowing this fact had actively made attempts to reduce the ‘Furniture Co’ margin on sales as they knew that they were their key client.
Morale was as low as it could get with both management and staff. They had lost motivation and direction, baillifs were arriving regularly and the cashflow management was based on paying who screamed loud enough from a pile of sign cheques which were left on a desk.
The position was horrendous and we took the troubleshooting case on to assist and support a hedge fund manager increase the value of this company upon their purchase.
SOLUTION
One of the strengths of the company was its consistent, stable and yet low sales. As long as you have stability in an area of a company you can build upon this stability. It was clear that the company needed to open up sales channels once financial stability was in place.
A Cashflow, Management reporting, budgeting and projections were implemented to bring clarity to the situation. Some moderate cost streamlining and reorganisation took place to create a stable platform where the company could focus on increasing sales.
The Management team with this clarity became inspired and more driven. Engaging them back into the company encouraging active plans to develop increased sales.
A fresh new range of designs, a marketing campaign which included a new brand identity, website, social media and active email campaigns to target new business repositioned the company in a new light. In addition to promoting an increase in B to B clients the company has now embarked on offering its product direct to the consumer.
Financially although the investment into these growth areas has not resulted in a substantial increase in profit yet, its value, positioning in the market and potential has.
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| The Troubleshooter - big company encounter | | The Way in Business | | The Troubleshooter - its business and its personal | | Budget comment for the Belfast Telegraph | | Business Turnaround - Forecasting Your Cashflow |
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