KSA was invited to help this old established label printing company in the West Midlands by its VC (venture Capital) owners. Financial control had disappeared even though there was qualified chartered accountant on the board!
KSA was invited to assess the problems, look at the options and suggest a plan to manage a company turnaround. Our plan was to remove the board (especially the FD!), but retain the managing director, appoint a new local accountancy firm to provide proper management accounts on a monthly basis, then recruit a new operations director. The company would also be placed into a company voluntary arrangement to protect it from tax and trade creditors.
Once we were appointed, the company’s disastrous accounting became a real problem for the bank. The company was using a factoring facility and the invoices were not supported by proof of delivery, plus there were hundreds of small credit notes and no one knew who owed what to the company.
So our remedy was to put in a team of 5 people to go through the thousands of invoices over the previous 9 months and set up a debt management team to chase the debtors who were so old that their invoices were simply not factored because of ageing. This was a 7 day a week process as it was likely to kill the rescue dead if the bank withdrew factoring support.
This brought in over 200,000 of old unpaid debtors! And for the first time we felt the company had control over the financial position.
We got the company into a CVA and reduced the workforce by 15 people. The bank borrowing fell dramatically and we got the company under control of the board. After 4 months we had rebuilt a management t team and appointed an ops director. At that point we stepped down and let the directors get on with the show.
The MD’s comment was: “I cannot believe we let the business numbers get so out of control that we didn’t know what money we were owed. Thanks to KSA, we got our company out of a potentially fatal nosedive”.
The business has since been sold by its owners and it is now profitable.
Turnaround Management Services
Turnaround Management expertise is a skill that few people possess, although many purport to be experts!
Keith Steven has been involved in turnaround management since 1993 and has seen good times and good results, bad times and bad results as well. Keith focuses mostly on managing and driving KSA’s growth and internet marketing now and building a team of quality turnaround advisors across the UK.
We have teamed up with a number of highly skilled turnaround experts across the UK, over the last 13 years to provide sector specific skills turnaround management to our clients when required. FD’s, production experts, Non Exec chairpeople and directors. We can find high quality people quickly to resolve turnaround problems. Call Keith 07833 240747 if you have a requirement.
Private equity, senior and mezzanine debt holders could find this CVA/Turnaround approach useful in these difficult times. Avoid ADMINISTRATION LOSSES, use CVA.
Call Keith Steven on 07833 240747 to discuss your requirements.