This 125-year-old, family-owned and -managed company had occupied five adjacent multi-story buildings for 85 years. In recent years, profitability had substantially decreased, and the local redevelopment authority forced them to move. The company had no computerized inventory system, and all operations were excessively manual. The warehouse was subject to substantial merchandise shrinkage.

G&ZM implemented several improvements to turn this business around. We:

• Moved the company to a modern one-floor facility with greater access to larger geographical market.
• Engineered and installed conveyorized order picking as well as a computerized inventory system.
• Reduced internal and delivery costs.
• Recruited professional managers for buyer and information systems.
• Reorganized sales territories.
• Negotiated lines of credit and equipment loans.
• Led aggressive collection effort for significant overdue accounts receivable.
• Established methods for identifying profitability by product, customer, and individual order. This guided the development of a more profitable mix of customers and products.
• Positioned company for prosperous growth.

G&ZM first got involved with this company when it was fairly small – only $2 million. We helped by establishing production-management controls, as well as pricing and inventory disciplines.

Subsequently, we guided the owners in expanding their business. This involved increasing profitability and ROI, moving to larger operating quarters, and vertically integrating backwards into the manufacturing of plastic strap for packaging. Today, this company is recognized as an important supplier in several product categories.

At this company, two equal owners were suing each other over the direction of the company. Consequently, a NJ Superior Court appointed G&ZM as the provisional director of this "deadlocked corporation" We held board meetings and resolved the owners' issues. Subsequently, one owner sold out to the other.

G&ZM cut receivable losses by $200K and days sales outstanding from 67 to 53. We increased turns of inventory from five to six, freeing up $150K in cash. We also took all additional product discounts offered, generating additional profits annually by $130K.

In just four weeks, G&ZM showed this company how to implement an operational perpetual inventory system using the company's software systems. We also developed a strategic plan that helped this company become a fully operational MRP software user.

Nnew competition and a major recession caused sales at this company to plummet from $5 million to $3 million. Profits, which had been about $1 million, turned into a loss. Financial analysis revealed that the physical inventory was $350K less than the book inventory. Furthermore, there was no inventory at all for the best-selling products, but plenty of inventory for products which did not sell.

G&ZM recommended the sale of this business to a competitor. This relieved the owner of all his liabilities and provided him with cash at settlement. The owner was most gratified.

This company was in "loan workout." The business was no longer viable in its industry. G&ZM developed a plan to phase out the business, pay off debts, and prepare for the sale of its remaining assets.