client story€¦ · • removed owner as the hub (hub & spoke model) moving responsibilities...

Growing Companies. Growing Leaders. Creating Legacies. 610.336.0514

Compass Point Consulting, LLC • 1525 Valley Center Parkway • Suite 300 • Bethlehem, PA 18017

client story

BUILD VALUE • Strategic Planning | Scaling Up

• Value Acceleration

• Leadership Team Development

• Succession Planning

• Family Business Governance

NEXT CHAPTER• Prepare for the 5Ds

• Define Your Vision after the Business

• Transition To vs Leaving From

• Three Hurdles

• What’s Your Runway

UNLOCK WEALTH • Financial Modeling for the Owner

• Tax Buckets

• Lifestyle Expectations

• Harvest Income from the Business Now

• Manage Risk

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A F A M I L Y B U S I N E S S O P E R A T I N G S Y S T E M

Ready to build a business that can run without you?RSVP and join us for a ValuePoints™ Workshop!

FEB 2019

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www.compasspt.com

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Owner Challenge:

• The owner IS the business. It will be difficult to transition out if he doesn’t build out a strong leadership team

• Owner needs to delegate some key responsibilities to other team members

• Owner uncertain of how much money he needs from the sale of the business to give his family the financial security he desired

What Owner Wanted:

• Transition the business within five years and keep the brand alive

• Improved communication and accountability with his leadership team

• A clear plan for growth

APPEELING FRUIT

Results after 48 months

Received an unsolicited offer from a third party: SOLD!

Growth in revenue: 71%

Growth in profit: 189%

ROI on investment: 32X in 48 months

Results of the ValuePoint™ Process:

• Developed rolling 3-year strategic plan with the leadership team; built in accountability and monthly meeting rhythm to monitor progress, learn, and adjust as needed

• Hired key positions (purchasing, maintenance, sanitation, sales) that increased the business value

• Grew top and bottom line substantially

• Made deep inroads into a new market segment that made the company very attractive

• Invested in professional development for the leadership team

• Removed owner as the hub (hub & spoke model) moving responsibilities and accountability to his leadership team

• Helped owner start to pull money out of the business in a tax efficient way and invest in other investments, reducing his risk and the amount of money he would need at transition

• Developed an Emergency Management Plan that gave directions to his spouse and the leadership team as to what to do if he was unable to work for any reason (disability, death, etc…)

• Transitioned some stock to a family member who was a key employee and was being developed as the successor, prior to the 3rd party sale

• Helped spouse manage her pension transition at her retirement and provided full visibility of the family’s financial picture

Business Challenge:From a small startup to a multi-million dollar business, this owner began looking to the future. While the company was growing, it was not growing in a sustainable way. He was wearing too many hats. A long-time controller was retiring. The remaining team was young, operating in siloed departments and missing key positions. There was no successor, no strategic plan, no marketing plan and no dedicated sales force. The absence of metrics and insights made it difficult to guide the financial future of the business and plan for the owner’s eventual transition. He realized he needed a better operating system.

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https://compasspt.com



client story









• Three Hurdles



• Tax Buckets



• Manage Risk

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FEB 2019

www.compasspt.com

BRADLEY PULVERIZER

Owner Challenge:

• Wants business to transition to “Next Gen” whether within his family or another family

• Key employee retention

• Succession for aging workforce

What Owner Wanted:

• The business legacy to continue

• Employees to keep their jobs

• Receiving a fair value for the business


Transition plan developed and owner’s Next Chapter envisioned: Priceless





• Developed a written three year strategic plan, broken down into quarterly priorities

• Aligned the leadership team which provided clarity and direction for them and the owner

• Implemented an ERP system to streamline and track production

• Updated buy/sell agreements

• Updated all estate documents

• Conducted a formal valuation that has identified areas the company needs to improve in order to reduce risk and improve value

• Improved collaboration and communication between the US and UK office

• Created a manual of key processes and procedures

• Developed proactive business development activities to better serve customers and find new opportunities

• Hired several new International Manufacturer’s Representatives to support the inside sales team and expand global reach

Business Challenge:

A business owner of a niche industrial equipment manufacturing company faced a dilemma. The 100-plus-year-old global company had stalled revenues, lacked clarity in its growth plan and poor communications between its US and UK office. They were missing a proactive maintenance plan for existing customers, leaving relationships unsupported and revenue on the table. He employed a skilled, yet aging workforce whose valuable knowledge was not documented. To compound his efforts, there was no clear successor, as his next gen options were pursuing other interests and had no interest in joining the business.






client story









• Three Hurdles



• Tax Buckets



• Manage Risk

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FEB 2019

www.compasspt.com

Owner Challenge:• Classic EMyth by definition: the owner

was the entrepreneur, manager and technician all in one

• Owner was wearing too many hats (sales, operations, finance, human resource, etc.)

• Owner’s wife was helping with finance and administration, but it was requiring more and more time from a mother of four

What Owner Wanted:

• Improved profitability

• Not to be working 24/7/365

• Peace of mind

ERWIN FORREST BUILDERS


Increase in employees: 9 to 21




Results of the ValuePoint™ Process:• Hired dedicated office manager to shift accounting, HR and administrative duties off

of the Owner

• Defined the core customer to know when and why to say no to some prospects

• Changed the pricing model to meet the profit goals

• Identified profit leaks, i.e. estimating, change order process, labor efficiency

• Hired new estimating professional – and significantly freed up Owner’s time

• Implemented strategic moves to streamline workflow:

- A cloud-based job management system and scheduler

- Change order process managed by admin

- Weekly foreman meetings to review budget vs actual hours, project schedule, and meeting customer expectations

- A monthly rhythm between Owner and his team

• Hired key field personnel with expertise in remodeling to address the changing market

• Recommended a part-time CFO Advisor to help Owner streamline accounting, develop a cash flow projection, and assist in developing a CAP EX budget

• Up to this point, all profits were going back into the business. We introduced a wealth advisory firm to help the owner develop his financial certainty and begin saving for his family and his next chapter, while still ensuring the business had adequate working capital

Business Challenge:The owner was the business – sales, customer service, operations, finance, and team building. At the same time, the residential building market was getting more challenging. Environmental and permitting regulations were making new construction more difficult. Some customers were opting for large custom remodeling projects rather than building because it was easier for them to stay in their current home (or buy an existing home) and remodel versus build new. The business had to build out a team that could both build custom homes and high-end remodeling.






client story









• Three Hurdles



• Tax Buckets



• Manage Risk

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FEB 2019

www.compasspt.com

Owner Challenge:

• Owner not having enough time to focus on the big impact opportunities

• Too many decisions were making it all the way to the owner that should be handled by others on his team

• Key employee retirements

What Owner Wanted:

• Someone else managing HR

• Business processes in place to reduce errors and improve efficiencies

• Business growth

• More time with his family without worrying about the business

THE YURCONIC AGENCY


Owner is able to travel with family for extended periods of time and the business runs smoothly: priceless





• Reorganized the leadership team – removed some, added others

• Developed a strategic plan and a meeting rhythm to review results, troubleshoot, and decide next steps

• Hired a COO

• Hire new Controller to replace retiring CFO

• Restructured the business units to reflect current needs of the market

• Implemented a management/leadership training program

• Re-branded the business to better position the company as a team vs an owner

• Hired strong leaders in two of the business units to drive results

• Implemented an annual company-wide meeting that united the team and provided clarity and direction

• Improved sales talent

• Maintained revenue and profitability in a business unit that lost nearly 50% of its income due to a regulatory change through new business and business model innovation

Business Challenge:

Even with success, an owner can hit a plateau. The “Hub & Spoke” model was in full force preventing the company from scaling up (aka the owner was making too many daily decisions). The business was also missing key drivers like a strategic plan, the right people in senior positions, leadership development, a plan for recruiting sales talent and a next generation succession plan. The bottomline was stalled because the owner was spread thin running the business while also working to navigate an ever changing industry with complex regulations. Owner recognized he needed an outside perspective to build a business that could run without him.




client story€¦ · • removed owner as the hub (hub & spoke model) moving responsibilities...

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