Industrial Drying Ovens

Industry. Industrial drying ovens

Location. Boston, Massachusetts

Size Of The Company. $75 million

Who Brought In ERG. Accounting firm referral. Hired by the owner

Goal Of Assignment. Operate the company until buyer can be found (COO/CFO). Establish financial and operational controls. Develop a management process to operate the company, improve morale and stabilize the workforce. Work with the lenders and creditors on acceptable payment schedules. Improve working capital.

Actions Taken. Established control over cash flow, developed a daily management process, worked with creditors and vendors on repayments schedules. Developed systems, controls and metrics to operate the company. Improved on time deliveries.

Results. Company was sold at 2 times book value. Pretax profits went from -11% to 5% profit in 7 months.

Assignment Duration. 1 year

Resources Utilized. Internal resources of the company

Issue Faced. Owner wants to sell the company, however the company is in tough financial condition because of a large debt load, poor controls and high turnover of management and poor morale. Vendors are threatening to stop shipping raw materials.