Stabilizing a Multi-Plant Contract Manufacturer Through a Liquidity and Leadership Crisis
A PE-backed contract manufacturer serving the beauty and personal care industry was bleeding cash, running out of runway, and operating without a functional finance team. We stepped in, took the seat, and steadied the business.
From Liquidity Crisis to Integrated Operating Platform.
Post-COVID Pressure, C-Suite Turnover, and a Finance Function in Free Fall
A ~$1.5BN AUM PE firm had built a contract manufacturing platform through the acquisition of complementary businesses across Arizona, California, and Ohio. The platform served major beauty and personal care brands, operating three production facilities. In 2021, the business generated $215M in revenue and $30M in EBITDA, with a projected upward trajectory into 2022.
Then the macro shifted. Supply chain disruptions and COVID-era cost pressures eroded margins. The company continued drawing on its revolving credit facility to fund operations, creating mounting liquidity and covenant concerns. High C-suite turnover left the organization leaderless and siloed. Ownership had gone three months without receiving financial results as performance continued to decline.
In the Seat. Not on the Sideline.
The PE firm engaged Areté to provide interim CFO, COO, and FP&A coverage. Not advisory support, but operational leadership. We deployed immediately, embedded on-site, and took ownership of the work from day one.
Business Stabilization
Working alongside existing management, identified critical areas for operational and financial improvement. Addressed customer relationships, renegotiated with vendors, and reinstalled the financial processes that had lapsed under prior leadership.
Liquidity and Covenant Management
Built a 13-week cash flow model to assess near-term liquidity needs and identify levers to extend runway. Managed customer collections and vendor disbursements to navigate a nine-month working capital crunch without a single additional draw on the revolving credit facility. Passed every covenant test throughout the engagement.
Financial Reporting and Board Visibility
Established a weekly and monthly reporting cadence for the board and PE owner. Prepared and presented management reports that gave real-time insight into business performance, restoring ownership confidence and enabling data-driven decision-making for the first time in months.
Operational Integration
Broke down the siloed operating structure across three plants. Implemented a multi-faceted financial dashboard connecting plant-level KPIs to consolidated company performance. Empowered business unit leaders with the tools and accountability structures to scale their operations independently.
Leadership Transition Support
Provided continuity and institutional stability as the PE firm conducted a search for permanent management. Designed the financial infrastructure and reporting framework so that incoming leadership could step into a functioning, well-documented operation from day one.
A Platform Rebuilt to Perform.
Through operational improvements and financial discipline, LTM EBITDA increased by 25% over the course of the engagement, delivering measurable value creation for the PE owner.
The company passed every covenant test during the engagement and navigated a nine-month working capital crunch without drawing further on the revolving credit facility.
Weekly KPI dashboards and monthly board decks restored financial transparency, giving the PE firm the real-time insight it needed to manage through the transition and prepare for a new management team.
Three siloed plants were brought into a unified operating model. Business unit leaders had clear accountability and the financial tools to run their businesses. The collegiate culture that emerged gave the incoming team a foundation to build on.