Business Performance Improvement: Sporting Goods Manufacturer
HSA Consultants were recruited by the owner of $9 million sporting goods manufacturer (with substantial losses, negative cash flow and stagnant sales) to restore profitability and help grow the business. We took over business management and promptly improved:
• Cash position - Receivables cut 50% with stricter, consistently enforced credit & collections policies; inventory turns doubled (distressed inventory disposed, sku count reduced, NPD slowed to match market need, stricter return standards). Sold non-core, non-cash generating business.
• Sales growth - Negotiated licenses with top world brands to protect core business and reduce risk of diversifying into much larger, new channels; broadened heavily concentrated customer base (6 of largest 10 customers acquired from new channels); $6 million new business in Warehouse Clubs; won $2 million OEM business from licensor.
• Gross margins - Strict enforcement of policies and reduced shipping exceptions; identification of unprofitable larger customers and execution of individual profit improvement plans; exited unprofitable channels.
Profitability and cash flow dramatically improved with sales growth to $25 million. Business value increased from $8 million to $28 million over 48 months. back»