Over the years Gary’s strategic mindset has guided business owners through their business challenges by providing the clarity needed to produce profitable results. The following case studies are examples of how bridging the gap between current reality and desired future drives business success to the next level.
I occasionally serve as a consultant for Business Oregon, and they contacted me concerning a SE Portland food processor that produces a line of vegan and vegetarian breakfast burritos and hoagie style sandwiches. The food processor had maxed out their current space. They wanted to grow, but instead they were turning down business because they did not have the necessary capacity. Their customers were asking to purchase more of their delicious products. The business had grown every year and been profitable every year as well, but they had hit a wall. In addition, they wanted to add a frozen food line to have the ability to distribute nationally and potentially internationally.
The problem was that the business was out of space and they didn’t see how they could produce any more products using their current facility. In order to expand they would need a new facility, which meant they would need bank financing. They needed a solid business plan and to ensure the financials were in order so they could seek bank financing and also work with Business Oregon on partnering in their expansion goals.
I worked with the owners and their two sons to examine potential adjustments within their current facility that would allow them to increase output without adding any additional employees (which they had no room for). I assisted the owners in developing their business plan and creating financial metrics that would allow them to forecast growth and the costs associated with their intended growth.
As a result, both the bank they were working with and Business Oregon were interested in working with the owners to build a new facility with a mechanized linear production line to increase production. Business Oregon was also interested in promoting this Oregon product nationally and internationally.
Business Reorganization Reduces Debt and Generates Positive Cash Flow…
I was initially called in to evaluate the COO in this business and to coach him for success. In the process of interviewing the CEO, he realized that he was in need of coaching as well. The business was not running as well as it could. Once I started my work, I realized that there were deeper issues affecting the entire business and though discussions with the CEO it was decided that I would drill down a little deeper.
After a complete business analysis it was discovered that the business was on the verge of bankruptcy. The CFO was incompetent and did not understand the financials. The CEO didn’t know they were in such bad of shape, their banker didn’t know, the CPA didn’t know and neither did the employees. The business was not generating sufficient revenue to cover their immediate debts. They were deep in debt and had a large amount of unsold inventory that had already been paid for or was owed money on. The rent on their current facility was going up by 200% and they couldn’t afford the current rental expense. The business had diversified into multiple other businesses that were draining their cash.
We immediately downsized the operation by letting the CFO and four out of the eight employees go. We acquired a much smaller facility at a fraction of the cost and moved the business cutting the rental expense by 150%. We began selling off surplus inventory to generate cash to pay vendors and reduce debt. We closed the other businesses that were a huge cash drain and got refocused on their core business.
As a result of reorganizing the business they were able to avoid bankruptcy and start paying down debt. The business refocused on their core competency and eventually let another employee go reducing cost any further. Currently the business is running much better, reducing debt and generating positive cash flow.
Global Business Plan Creates a Solution with Long Term Benefits…
During the greatest downturns in business history since the great depression, we were called in by a client that was struggling to stay alive in the existing business environment. For over 60 years they had experienced excellent business growth and had weathered all previous downturns with minimal damage. This downturn was much different. Business was declining and they were struggling to cover expenses even after extensive cuts and layoffs.
We were able to analyze their business practices, previous sales history, and product mix. We looked for other potential markets outside the U.S. as potential partners. We were able to diversify the clients sales base by facilitating a new global business plan that developed business in China and Russia allowing the client not only to diversify their customer base and product mix, increasing revenue and allowing for greater profitability.
As a result of global business expansion, this client was able to weather the biggest downturn in their company history. This new global business allowed them to develop a long term diversification of revenue streams outside the U.S. They were able to remain in business and as the economy started to come back they were able to continue their long history of providing quality products to the U.S. market place.