Industry: Consumer Electronics
Challenge: Business owners often wait until the last possible moment to seek help, and such was the case here. By the time CRS was consulted, Russound's revenue had declined nearly 70%, its line of credit was maxed-out and there were not enough assets to borrow against. Refinancing was out of the question and we had a very small window of time to effect a turnaround.
Solution: Negotiated new payment schedules with Russound's vendors, buying time to implement cost-cutting and revenue-generating strategies. Took bold steps to restructure Russound's product line. Made wholesale changes to the company's vendors, manufacturers and logistics strategy. Immediately sold cash burning division.
Results: Revenue is up 23% from its low with a 33% year-over-year improvement in EBITDA. CRS successfully refinanced Russound. The company has a new product strategy that makes it more competitive. Redesigned legacy products and added new products to the line, thereby improving product selection and service, while preserving margins. Russound's restructuring has strategically positioned it in the industry, and these changes serve it well into the future.