Practice Area: Operational turnaround; outsourced CFO and
accounting
Industry: Shoe design and manufacturing
Location: Pacific Northwest and Asia
Client: Company
Role: Financial advisory and accounting support
Our client is an established designer and manufacturer of a
variety of fashion boots and shoes for both adult female and male
consumers. The company has also developed a successful line of
shoes, boots and accessories for the children’s market.
The company’s outside accountants, a large regional CPA firm,
referred us into the business. The company had been successful in
growing the top-line revenue, but had not been able to do so
profitably or with an understanding of the necessary operating
controls required for the business. The bank had realized that the
company was now insolvent and had proceeded to call the loan and
demand payment from the guarantors.
Our analysis immediately identified the primary source of the
financial problem as a lack of control over the inventory and supply
chain management in the manufacturing process. As a direct result of
the operational changes Turning Point implemented, the company was
able to more efficiently pick-and-package from inventory and reduce
the size of the inventory by 50%. New warehouse procedures generated
increased accuracy of orders picked, on-hand inventory accounting,
and reduced charge backs.
We were also able to renegotiate the loan arrangement with their
bank that allowed for ongoing funding of the business while we
helped turn the business around. Today the business is generating
approximately $20 million in revenue and a pre-tax profit of nearly
15%.