A West Texas client was in the third year of consecutive business losses. Performance during this time was constrained due to a string of natural disasters that negatively impacted the agriculture industry in Texas. With bankruptcy on the horizon the client called on Najera Consulting Group for assistance.

Core Competency: Financial Assessments & Strategy Development

Consulting Objectives

• Assess the impact of various operational and financial activities on client's profitability.
• Develop and implement a strategy for the client that will allow it to out-perform its competitors, achieve an advantage in the midst of a rapidly changing competitive environment and create long-term shareholder value.

Approach

• Conduct a horizontal and vertical financial analysis of all statements and operating reports to determine trends in all revenue, cost and expense categories.
• Determine the cost and expense relations to revenue and the pattern of costs as variable and fixed to revenue.
• Develop integrative (profit/loss, cash flow and balance sheet) financial pro-forma statements.
• Develop internal management financial processes for use in planning, controlling and monitoring operations.

Outcomes based on client feedback

• Company's gross profit margin increased from 19% to 34%.
• Total expenses were reduced by $513,717.
• Client exceeded their previously established sales goal by 10% following implementation of our recommended strategy.
• Company's net income increased by $80,170.

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