CBS Reviews: Money Well Spent

Situation

Corporate Business Solutions was hired for “a complete overhaul” by a manufacturer & distributor serving the commercial automotive repair marketplace for more than 30 years.  Areas of focus included financial reports, production and sales, setting up policies and procedures that would allow the company to reach the greatest level of profitability possible.

“We had a base of operations, but no businesses processes in place.  My staff was weak and, in some cases, overcompensated.  The financial records that we had were so disorganized and inaccurate (due to seven different, poorly-trained bookkeepers over seven years) that they were practically useless to us.”

Process

After a review of the corporate financials, operational structure, products, and manpower, the CBS consultant was “very diplomatic with his comments.  I have to say it was troubling to hear what I already knew, but his main interest was to set up my company to be efficient and profitable.”

The consultant dived into financials, making key changes.  “Account receivables are now organized such that our funds are collected in less than 10 days, on average, and that our payables are met within 13 days with healthy discounts, which we never enjoyed before.

Our consultant helped us organize a physical inventory for the first time in nearly two years.  Our adjusted inventory showed an increase of $150K worth of materials on the shelves versus what our screwed up books had previously shown.  We now have a procedure for taking inventory accurately every six months.

He also took the monies that I had loaned the company to purchase inventory and structured a long-term note payable back to me for a little over $200K.  This cleaned up our books to the point where our business is presently applying for a $100K line of credit from our bank.  He made a convincing presentation of our business plan to them. 

This was a major issue as our financials were still showing old numbers that should have been removed years ago, but with the turn-over in accounting, our books just kept getting worse every month.  He did a great job straightening us out on this front.”

He then addressed employee management.  “He set up Daily Production Sheets for the manufacturing employees—welders, sheet metal workers, assemblers and for our painting department.  He also established clear shipping and receiving procedures with numbers that connect with our accounting records.

No employees had to be let go.  Areas, where we were not profitable, were reviewed and those employees were assigned more responsibilities in other production areas.”  Products are now able to be tested and shipped in a shorter period of time.

Sales and Marketing also came under the consultant’s scrutiny.  Although the company made good products and had a well-respected name, the Sales and Marketing department had been underfunded for years.  “The need for the increased used of advertising, mailers, email/fax blasts, and website improvements have, historically, been a problem.”   The consultant “jumped in and had all of these underway with new procedures, timelines and metrics to determine effectiveness.

He also worked with our Sales and Marketing Manager on programs to take advantage of our contract awards with national government agency buying groups.  He provided us with targeted contact lists of prospective buyers for our products to boost our Sales and Marketing efforts into a higher gear.”

Result

“While we did not fix every little piece of our company that is broken, we did improve and establish programs and procedures that will be the foundation of our operation for many years to come.  He improved our sales, profits, productivity and cleaned up our financial mess.”

“Was it money well spent?  Yes.  Would I do it again?  Yes.”   Bob, Owner