Insights
- The company was a family-owned media company that conducted and promoted consumer research and recommendations
- Rapid expansion into four new southeastern markets had resulted in significant strains on cash flow and operations personnel
- The management team was weak and inexperienced, particularly in supporting growth
- The company was not profitable and had a poor cash position with no access to funding
- Only 90 days of cash remained and the company’s survivability was at stake
Action
- The Newport partners were engaged to assess and make prompt changes as required
- A stabilization plan was initiated to ensure the company’s ongoing viability
- Funding alternatives were quickly identified and accessed
- Cost reduction opportunities were immediately recognized and implemented
- Cash conversion cycle improvements were made and opportunities were identified
- A short-term business plan was defined and initiated, along with a longer-term plan
- Growth opportunities were reasonably assessed and prioritized
- The existing organization and staff were evaluated and roles were defined
- Operations processes and procedures were reviewed, developed and refined
- A 10-year term loan was obtained to provide reasonable runway for the company’s future measured growth
- More effective billing and collection policies and procedures were devised and implemented
- Metrics were created to provide more effective, ongoing measurement of company performance
Results
- The company achieved profitability and stability within a short time frame
- A Newport partner was engaged as General Manager to provide professional management
- The long-term business plan was finalized and buy-in achieved from the owner, which included a transition to a more digitally-focused company
- Outside market operations were terminated and operational focus was attained on the home market only
- Operating expenses were significantly reduced
- Expansion into any new business channels was limited to utilizing existing resources
- Significant improvement was achieved in the cash conversion cycle
