Sometimes bad things happen to good companies. And what is needed is help navigating through troubled waters. Companies are impacted by various kinds of dislocation caused by tariffs, commodity costs, technological changes, or other economic impacts that cannot be predicted. The impacts are on cash flow, working capital availability, deteriorating gross margins, shifts in customer buying patterns and many other areas affecting profitability and survival. Occasionally, the solutions are simple, but good outcomes usually require a combination of actions to get the best results.
EMAGroup works through a process that includes planning, implementation, measurement, and the ability to show positive results. Outside help is needed because the situation is not business as usual. The lender(s) is concerned about operating performance and begins tightening down working capital availability. Trade creditors are concerned about extended vendor payments, and are pulling back on payment terms, allowable shipments and credit support. Sometimes the management team is in disarray because of changes in leadership or because they are managing too many roles and initiatives. EMAGroup is experienced in handling these kinds of issues and getting to the best solutions.
Turnaround & Business Restructuring
“While other advisors and consultants will just tell you how much time remains before the building burns down, we rush in to extinguish the fire and immediately start the rebuilding process.” – EMAGroup
Crisis management is often an important element of the turnaround process as a multitude of issues arise that need to be managed. So, EMAGroup takes an active role in the turnaround process and, as needed, we work shoulder-to-shoulder with our clients to help execute the turnaround process. And there is a process and method to a successful turnaround which is based on proven experience in many similar transitional situations. Our Certified Turnaround Professionals provide immediate and effective hands-on financial and operational strategic assistance to senior management, board members, and investors. Our mission is to guide and help our clients manage through crises, whether out-of-court or in bankruptcy.
EMAGroup simultaneously focuses on the strategic business restructuring and recapitalization issues involving capital structure and debt capacity — restructuring of the balance sheet, the realignment of resources, sale of non-core assets, and structuring and helping to negotiate transactions and capital sources. None of this is normal course for most companies. So, we help management fill the gaps and allow them to focus on the core business operations while we help with the nuances of a successful turnaround and restructuring process. Our role in the restructuring process frequently involves the following activities:
Enterprise Performance Improvement
Our approach is grounded in understanding the business operations details and using data analytics to help find root cause issues and options to fix the business. Companies frequently lose sight of the forest for the trees. The business environment is in a constant state of change. And companies need to adjust or lose out to best-in-class performers.
There are frequently opportunities to significantly change and improve the business to drive improved gross margins and manage indirect costs. Sometimes the solution is improving the supply chain, or rationalizing product and customer mix, or using LEAN to get more out of the production process. In some situations, it is crucial to completely rethink the business and exit business lines or outsource non-core functions.
Our team has both management and consulting experience along the entire manufacturing and supply chain to help companies create and sustain value.
Investments do not always go as planned and can become a time-consuming project for the operating and investment teams. EMAGroup has been instrumental in working with private equity and mezzanine funds in preserving and recapturing value.
On multiple occasions, investor groups have turned to us to help fix a troubled situation after all other options and resources have been exhausted. When a liquidation seems like the only solution, we can often find another way to obtain a soft landing by finding additional value in the assets or alternative investors and buyers. A sale transaction (in some form) will often be a much better solution than a liquidation and the aftermath that can occur.
We work with numerous groups across the country interested in buying broken assets. But importantly, we can usually find additional time and runway to complete a successful transaction. This is what we do. And it is better to have EMAGroup take on this role than diverting your team’s attention away from performing assets and new investments.
Entrepreneur & Family-Owned Businesses
The interpersonal dynamics of an entrepreneurial or family-owned business are different than those found in typical corporate America; they frequently do not have the structure and disciplines imposed by private equity investors. Intelligent entrepreneurs with strong personalities like working with smart, fact-based advisors. EMAGroup team members have a track record of helping entrepreneurs become more successful working through a challenging transition period. We have a history of working with name brands that suffered challenges along the way to achieving new heights. Our admiration for entrepreneurs is grounded in their ability to think out of the box and quickly move past barriers that stop or dramatically slow down other businesses.
Family-owned businesses operate in various forms but have a common connection in entrepreneurial founders and second-generation leaders wanting to preserve a legacy for their families and children. Whether or not the second or third generation is actively involved in the business, key business decisions often become personal. We have served as coaches, facilitators, interim leaders, and as family business counselors. When the family business is in transition, we help facilitate the tough decisions based on facts and data analytics, and eliminate emotion from the process.
And when a sale exit becomes the best option, we know how to strategically position the business to have the most value. We have a long history of helping entrepreneurs obtain increased value for their businesses, even when those businesses are initially perceived as being distressed.