The Win-Win-Win Case

US-based Luxury Consumer Company

Historically, most turnaround cases end up having some winners and some losers. This recent case study is a case with only winners. The winners in this specific case are:

  • A US Luxury Consumer Company – the direct Client
  • The Client’s Lender
  • The Turnaround Management Firm (TM) advising the parties
  • Michael Roth Advisors (MRA)

The client was asked by its lender to work with a Turnaround Management Firm because it had tripped a covenant on its loan and had lost the lender’s confidence. While this is a classic turnaround situation, this client had lost its way not so much because of financial mismanagement, but in large part to marketing, sales and top-line issues. The client interviewed several qualified Turnaround Management Firms and the one that brought Michael Roth Advisors to the pitch won the case.

The client is the primary winner in the case. Long a leader in its industry, the company had hit a rough patch over the past few years. Today, with the help of the Turnaround Management Firm and Michael Roth Advisors, it is reinvigorated with a new, multi-faceted growth plan that required NO NEW SPENDING. As a result of the new growth plan and the fine work of the Turnaround Management Firm, the client also received an extended forbearance period on its loan.

The second winner in the case is the client’s lender – one of the largest financial institutions in the world. Throughout the case, the lender’s risk profile has decreased; it has had trusted advisors in place at the client for an extended period, and several interested alternative lenders have been identified take the original bank out “whole.”

The third winner in this case is the Turnaround Management Firm. While the Turnaround Management Firm was already perennially recognized as one of the industry’s “finest” management firms, it still found itself in a highly competitive bid process for this case. In the end however, the Turnaround Management Firm won the case not only because of its reputation, but because of the unique, growth-and-value-oriented consulting services it was able to offer through its partnership with Michael Roth Advisors. With this win, the Turnaround Management Firm is generating significant revenues as the case has moved into a marketing and sales implementation phase, has burnished its credentials with the lender, and has created another case study of operational turnaround management success.

Michael Roth Advisors is the fourth winner in this case. Michael Roth Advisors is a growth-oriented consulting practice that builds value through what it calls “Fact-Based Planning.” The Fact-Based Planning process has created remarkable results for more than 25 years for companies both large and small, and for both direct and indirect clients. The biggest win for Michael Roth Advisors in this case is the knowledge that the fact-based business planning process has again helped a client in trouble to find untapped, profitable growth from its business.

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