Success Stories – Manufacturer #2
We met this manufacturer when they were struggling. They had lost money for 3 years in a row and had a negative cash flow.
We realized that they needed help to survive, so we moved quickly.
Oak Hill identified the following issues in the business and went to work:
- Company had no sales or cash flow forecasting
- Debt structure was consuming an inordinate amount of cash
- Customers weren’t paying on time
- Poor financial performance
- Lack of financial and business management skills on the team
This resulted in the following solutions:
- Developed and implemented sales and cash flow forecasting that informed management of the results of operations and financial decisions
- Renegotiated loans and leases on behalf of the client to free up cash flow and align debt with operational goals
- Communicated with customers who were not paying in a timely manner to understand the issues, implement fixes, and bring them into payment terms
- Reviewed operations from a finance perspective and made several key recommendations for improvements including the capitalization of development costs related to a new product that showed the investment and properly reflected the true operational cost of the business
- Facilitated a discussion with a private equity firm that ultimately resulted in a recapitalization of the business
Results:
- Turnaround of growth, profitability, and cash flow in 12 months
- Recapitalization of business by Private Equity firm allowed for restructure of debt and ongoing management/partnership need