Facts
Background
The
business was established over 100 years ago but in recent years there had been
a steady decline in sales that had seriously impacted profits. The directors were nearing retirement, were
no longer as focused on the business priorities and unable to manage the
company through a turnaround.
Problem
There
was an urgent need to downsize the business, reduce overheads and introduce
fresh management.
Solution
We
strengthened the management team with the introduction of a turnaround interim
manager from our T-IM network. With a
fresh pair of eyes he re-focused the operation, sought out different markets
and introduced new products that utilised the skilled workforce. The business relocated to a smaller premises
owned by the same landlord freeing up the original site for redevelopment.
The
creditor position was held steady through a four year CVA and with
profitability restored made contributions into the voluntary arrangement which
paid 40 pence in the pound to creditors.
Difference
The
directors wanted out and were ready to fold the business but also wanted to look
after the long standing employees. This
type of situation usually ends in liquidation and a break up and most
insolvency practitioners would not think further than that. The appointment of a turnaround manager from
our T-IM network breathed new life into the company and with the creditors’
arrears on hold through the CVA and ongoing support from the external investor
we rescued the business.