Construction - Trade1
With a lot of know-how in their trade and some business experience, the two partners in this company were growing so fast they didn’t know how to manage it all.
The company lacked adequate working capital strategies, and we helped it double its line of credit facility with the bank. We implemented improved billing and collections procedures that reduced the days sales outstanding (DSO) by 15 days, which significantly accelerated cash flow.
We compared the company’s profit and expense ratios to industry averages and quickly found places for improvement. As the company grew, overhead costs were not very well understood, especially with how to account for overhead costs in the project estimating process. We helped the company implement procedures to correctly estimate projects and we re-vamped the job-costing system to give real-time and meaningful information to management. When the company hit a slow-year and actually shrunk for the first time in its history, we helped them make the necessary changes to their structure to weather the slump and come out of it more profitable than ever before.
One of the partners was doing his best to wear the CFO hat in the organization, but he was thrilled to hand that off to us. He was able to focus on growing the company, and within a year it almost doubled in size. Importantly, profits increased at a much higher rate.
This company had never experienced accurate and timely financial statements. We implemented the procedures to ensure these were provided every month without fail. These along with the forecasts, budgets, and other managerial reports have made all the difference in this business. We also set-up and oversee the production of a weekly dashboard/KPI report that allows the owners to, at a glance, see the most critical information about their business with trends and issues highlighted for their quick review.
Enter and Exit Successfully
When we were hired, the company was being valued for a potential sale. We quickly discovered and corrected several accounting practices that increased the value of the business by 20%.
This company has had its ups and downs, but the owners agree on one thing – hiring their CFOwise CFO has been one of the best business decisions they have ever made!