Type of business: Consumer Goods and Finance
Consumer goods and finance company, $20m revenues, high growth of 20+% per year, losses for 2 years, unable to pay IRD $500k for GST and PAYE on time, bank won’t lend more money and want to sell owners house as all covenants are being breached.
How we Fixed It
We addressed the business fundamentals, stabilised the business by slowing growth for 12 months, addressed stock purchasing and margins, addressed credit quality of new clients and better collection of slow paying customers.
A year on the business made $2+ million profit, within all banking covenants, the owner didn’t have to sell his house, the business able to get back on a growth strategy with a better business platform and the bank back on board. Three years on sales are $30 million, profit $3 million and bank willing to finance a $7.5 million commercial property.