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Endangered Species, Inc.

How to Bounce Back from Near Extinction

Marketing

Industry

Direct Mail

Services

Category

Vertical

Summary

A Marketing Agency in the Midwest survived bankruptcy and was revamped into a financially successful company through Turnaround Services provided by LeVert Management Consulting.

Situation

While this company brought in consistent customers, achieving $20M in revenue annually, it was fraught with every other problem imaginable.  

 

This marketing agency was in Chapter 11 bankruptcy and losing $1.3M annually when they sought the services of LeVert Management Consulting. In addition to the net losses, the company had substantial issues across its taxes, financing, profits, and cash flow.

 

The owners and top executives were uncertain about how to proceed in both the short-term and long-term, and had many conflicting objectives preventing them from leading the company out of disarray.

Approach

  1. Represented the company and key ownership before the IRS and IDOR.

  2. Created Offer in Compromise (OIC) in order to resolve dispute with the IRS.

  3. Focused efforts on correcting company’s past mistakes or minimizing the impact of these mistakes, and enabling ownership to continue doing business in the industry.

  4. Reviewed existing financials extensively and revised financials to correct errors retroactively.

  5. Sought new financing to obtain better terms for the company.

  6. Led complete overhaul of the Finance & Accounting department. Included implementation of proper accounting and financial processes and controls.

  7. Coached executives extensively on new processes and newly established financial discipline.

Results

  1. Prevented business from being shut-down by the IRS & IDOR

  2. Settled seven-figure IRS tax dispute resulting in a total balance of 1% of what was originally owed.

  3. Persuaded IDOR to return $150K it had confiscated from the company.

  4. Successfully established a new company which enabled family to retain ownership

  5.  Attained more traditional financing with a new bank loan.  

  6. Vastly improved profitability through financial overhaul and consequent immaculate balance sheet.

  7.  Executives continue to run a successful business today.

The Details

While this company brought in consistent customers, achieving $20M in revenue annually, it was fraught with every other problem imaginable. 

 

This marketing agency was in Chapter 11 bankruptcy and losing $1.3M annually when they sought the services of LeVert Management Consulting. In addition to the net losses, the company had substantial issues across its taxes, financing, profits, and cash flow.

 

The owners and top executives were uncertain about how to proceed in both the short-term and long-term, and had many conflicting objectives preventing them from leading the company out of disarray.

 

The company’s survival was in serious jeopardy and without immediate intervention, it would have collapsed. LMC’s first objective was helping them keep the lights on. We represented them in front of the IRS and IDOR, and prevented them from shutting down the business. The issues with the IRS were eventually settled via an Offer in Compromise (OIC) developed by LMC. This resulted in a settlement of 1% from a seven-figure amount originally in dispute. Additionally, the IDOR agreed to return $150K they had previously confiscated from the company. LMC also managed many of the company’s troubled business relationships, from unpaid vendors to government agencies.

 

Once many disputes were resolved, LMC led the establishment of a new entity which enabled the family to retain possession of the company.

 

With the new entity established, LMC embarked with two new objectives: 1) Improving the company’s financing, and 2) Fixing internal problems to help the company put its best foot forward. Helping the company switch from a factor to a more traditional bank for its financing resulted in improved terms and subsequent gains for the company. LMC also immediately began overhauling the Accounting and Finance department, implementing new processes and standards to help the business gain a solid financial footing. LMC also retroactively applied these standards to their existing financial records in order to gain an accurate financial history which facilitated the overall objective of achieving an accurate and immaculate balance sheet. The clean-up of the balance sheet resulted in an immediate, vast improvement in profitability.

 

Once the turnaround was complete, executive coaching began. The objective in providing coaching was to train the executives on the processes and discipline established by LMC to enable continued management of the company. LeVert Management Consulting is proud to say that the executives continue to run a successful business today.

Services Provided in This Story

  • Turnaround Services

  • Financial Strategy Services

  • Strategy Services

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