The Company retained Fort Dearborn to develop an operating plan and identify and implement profit improvement initiatives.
With Fort Dearborn's assistance, the Company successfully:
• Consolidated from three plants to two facilities prior to its seasonal uptick;
• Reduced the SG&A expenses by $500,000 through a reduction-in-force, changing public accounting firms and health care expenses adjustments; and
• Based on customer profitability analyses prepared by FDP and management, implemented price increases on certain parts and customers.
These initiatives generated over $3 million in annual profit improvements and returned the Company to profitability.
Additionally, based on FDP's inventory movement analyses, management implemented several actions to reduce inventory during the seasonal peak by over $4,000,000 and permanently by $2.5 million. This reduction created significant availability on its borrowing base during seasonal peak.