Manufacturing -- manufacturer of nuts and bolts
Timely and effective inventory liquidation
An asset based lender engaged us to conduct an operational analysis of a manufacturer of nuts and bolts. At the time of the engagement the manufacturer was conducting very limited manufacturing because of a severe shortage of cash. Shortly after arriving we discovered that the owner was not depositing all accounts receivable collections in the lock box but was instead using the proceeds to pay operating expenses.
We instigated a meeting with the lender, and the borrower agreed to turn possession of the inventory and receivables over to the lender. We commenced a search for prospective buyers of roughly 2,000,000 pounds of nuts and bolts and a buyer from Mexico was located who purchased the entire inventory for nearly twice the amount that the lender expected to receive. We also provided assistance to the lender in the collection of the remaining accounts receivable. The lender achieved nearly a full recovery including expenses.