Two-Phase Approach Boosts Sales by $89 Million
Company had major gap in product offering and with demand decreasing for primary product, it was essential to find way to fill gap. Distressed business partner was having same demand increase and had put that organization in financial jeopardy. However, two products could not be produced in same process, and expertise required for each was not readily transferable.
Created two-phase approach where two locations split and mirrored other product offering, which was owned by product expert. Integrated systems in second phase to allow both product groups to be handled in same operation. Took advantage of market distress opportunity to find way to improve results.
As result, sales increased dramatically by $89 million initially and continued to grow over time.
Competitive Business Plan Secures $22.3 Million Capital Advancements
Observed market force changes in asset-backed securities market offered company opportunity to create new asset classes. However, real estate market still carried residual of earlier market collapse. Additionally, five years of recovery data was necessary to reshape business ideas.
Devised competitive business plan to sell non-conforming loans for cash. Identified large asset holder without expertise and secured go-ahead for startup. Marketed business plan by focusing on appropriate investor audience, spending numerous earlier presentations learning correct audience.
Initial working capital advances of $1.3 million and $21 million were secured.
Pricing System Engine for Sales Team Achieves 41% Profit Margin Improvement
Sales margin was eroding during volatile interest rate environment, and sales employees were limited by natural hesitation to sell at higher market prices and margins.
Recognized innate behavioral tendency and developed strategy to get around it. Implemented pricing system engine for sales force that enabled real-time pricing with built-in margin protection. This ensured sales team was not focused on margins, but just on price.
Company's profit margin increased by upwards of 41%, generating additional $8 million in gross profit per year.
Systematic Benchmarks and Reporting Reduces Cost per Sales Unit 45%
Organization could not determine which sales leads were performing best, at what cost, and for what product. Company was marketing through active database of over 224,749 sales leads and buying more than 7,847 leads per month.
Developed systematic benchmarks and reporting of statuses by lead. Designed database to integrate pricing and volume information. Established internal purchasing decision processes to change lead purchases weekly.
Cost per sales unit was reduced 45%, reducing overall market spend by as much as $2.3 million.
Due Diligence on Approach Strategies Closes on 77% of Acquisition Targets
Environmental services price multiples were above nine times earnings, while private sales multiples were less than three. Investor team was committed to funding roll up; however, negotiations and evaluations with small, long-established business owners were difficult.
Evaluated key acquisition opportunities, created approach strategies, and worked diligently to sell owners on benefits of acquisition. Conducted successful purchase negotiations for more than 22 entities with high closing target.
Company closed on 77% of targeted acquisitions, purchasing 17 plants for $235 million.
Transitioning to MAS2000 System Reduces Costs 73%
Company had rapidly grown as startup to generate more than $400 million in monthly sales. Monthly accounting and inventory system was over burdened, requiring nine employees to manage and reconcile inventory. Additionally, accounting system was limited in technology and data management.
Evaluated current market systems and identified most appropriate solution. Negotiated purchase and led cross-functional team to install, train, and manage MAS2000 system. Redesigned workflow to take full advantage of new system features.
As result, inventory control staff costs were reduced 73%, eliminating more than $319,000 in annual costs.
Special Purpose Financing Vehicle Improves Capital Ratio
Company was having difficulty financing $4 billion in assets it was putting on its balance sheet each year. Additionally, organization was more highly leveraged than key competitors, which was driving down its stock price.
Developed plan to create special purpose financing vehicle as REIT, which would provide financing. Worked alongside legal counsel to prepare S-1 filing for REIT. Allowed investors to choose which type of company each wished to invest in, creating better environment for both types of investor.
Parent company went public with $500 million REIT, providing balance sheet holdings reduction of 12% while directly improving capital ratio by same amount.
Effective Investor Presentations Secure $30 Million for Future Growth
Founding investors wanted to create largest recycling company in country through roll-up strategy. However, while investors had previously used friends and family approach, investment required more than family circle could support.
Presented to Board of Directors fundamentals of Rule 506 Regulation D exemption offering. Secured approval from board to undertake offering. Created materials and potential investor list, making presentations that led to ultimate acceptance and funding of successive offerings.
More than $30 million was raised to support future growth objectives.
New Sales Management Structure Delivers 357% Sales Increase
In order to take advantage of sales growth opportunities, it was necessary to expand sales staff. However, while sales person recruitment results had been strong in past, without sales management structure and staffing, sales staff would flounder.
Designed new sales management structure with functional managers for training, new hires, and transitional sales teams. Hired 4 new managers and 110 salespersons within six-month period. This expanded sales team allowed company to achieve its very high growth objectives with relative ease.
Monthly sales production for company increased 357% within just six months from $14 million to $51 million.
Consolidating Accounts Saves $1 Million on Bank Service Charges
Treasury Department's budget for banking services was significant, and FO requested project to determine and implement cost savings in banking services functions. However, company had to manage more than 2,000 investor reporting bank accounts, each requiring cash management services such as same day reporting and check clearing.
Developed strategy to consolidate accounts in order to reduce operating costs. Marketed account relationships to several cash management banks, emphasizing value of deposit balances. Secured aggressive response from one bank to obtain all bank accounts.
As result, bank service charges were reduced 53% from $1.9 million to just $900,000 per year.
Multi-Brand Strategy Doubles Market Share
Market share in $2 trillion residential lending industry was highly fragmented, and no company had greater than 3.5% market share Company's market share was only 0.45%, because consumers demanded choice and options among lenders and those were not available.
Developed and presented "shampoo strategy" to Board of Directors. Developed five brands selling same product under different marketing and sales forces. Secured board approval and funding. Implemented development of brand management groups or acquisition of brands to flesh out offerings.
Company experienced doubling of sales volume within first year and broke through to critical 1% market share barrier.
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