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Fastener Manufacturer Success Story

fastener manufacturer success story

A Fastener Manufacturer’s Success Story

When we were called in, the company was overdrawn more than $100,000 at the bank, and hadn’t made any payments on their leases, loans, mortgage or real estate taxes for more than 4 months. The bank was threatening foreclosure, and there wasn’t enough money for payroll on Friday.

The bank agreed to delay foreclosure and gave us time to complete a cash flow forecast. In a meeting with each of the company’s major suppliers, we were able to get most of them to move us from Cash in Advance to COD, generating an additional 5 days of cash flow. We then arranged for some additional borrowing from the company’s factor, and deposits from some of the company’s major customers.

With more money to operate the business, morale in the company improved. Production quality improved, and we convinced suppliers to waive break-in charges to enable on-time deliveries to customers, while we got caught up.

Unfortunately, the company was burning too much cash. The owners agreed to an Assignment for the Benefit of Creditors. Our goal was to keep the business operating so we could sell it as a going concern. In the end, a holding company located in the western suburbs agreed to purchase the assets of the company.

With our approach and services, we ended up saving twenty three jobs. The owner received a job with the holding company. The bank loans were paid in full, and the owner’s personal guarantee was released. The banks refinanced the building, now that there was a viable tenant. The company continues to operate successfully to this day.