After 25+ years the founder and owner of the largest cabinet manufacturer in the province was ready to sell his business but was not able to close a deal. A connection was made with the owner just prior to the new home building market crashed to a level 30% of its level one year prior. Not losing sight of the end goal to sell the company, significant adjustments were required prior to that becoming a realistic option.
Leading indicators for the rapidly changing home build market were identified and trigger points identified to ensure the company adapted in real time to the severe market changes. The company’s cost base was adjusted to ensure cash availability. A scan of existing and potential clients highlighted common pain points of late supply, installation errors and poor after installation service.
The company’s focus switched from offering the latest colors, wood types and door styles to offering tightly scheduled client interactions, production and installation that aligned exactly with each builder’s schedule. Detailed drawing standards were implemented to ensure installers had the right information and the right materials to execute clean installations. Employee job descriptions and metrics were adjusted to align with the new company focus.
Selling became easy as the sales team was equipped with live detailed schedules covering from the time the builder sold a new home, to the time of final installation and handover of the cabinets – exactly the support builders were looking for. The company doubled market its share in less than 2 years while achieving a 10% increase in gross margin $’s and an 18% increase in EBITDA in a market half its pre-recession size. The business was sold for a 33% premium over the pre-recession value.