About us

Client Overview: $350 million brand name international designer, manufacturer and marketer of retail and contract furnishings with facilities located both domestically and internationally.

Opportunities/Challenges:

• EBITDA had decreased from a run rate of $40M to annualized $17M
• Overhead had increased three-fold
• Layered, non-responsive corporate office had been established
• Inventory levels and costs were out of control
• Off-shore sourcing in constant state of disruption
• Poor quality in company’s own facilities

Solutions:

• Focus efforts on overhead and operating costs
• Eliminate “corporate office” structure
• Establish four distinct market-focused SBUs
• Utilize China sourcing and logistics
• Move more product to Mexico
• Refocus SKU management and responsibilities
• Reduce SKUs by over 40% in the “traditional” market channel
• Establish detailed focus on cost
• No “Silver Bullets;” enforce cost and quality discipline

Results:

• EBITDA:
  • 2004: $17M
  • 2005: $27.5M
  • 2006: $33.5M
  • 2007: Low 50’s
• Drove manufacturing cost efficiencies from operating margin in low 20s to mid-40s
• Improved “big box” channel profitability by 30% – from an average of 14% to 18.3%
• Each SBU became its own profit center
• Re-gained leadership position “channel-by-channel” in product offering and design through disciplined product design and replacement process and procedures
• Improved employee turnover at the same time by reducing employee costs with consumer-driven health insurance