Turnaround of DJ Equipment Company
The Challenge
The client had been a long‑time global leader in musical performance hardware, but new competitors and shifting distribution dynamics pushed the business into financial distress and, ultimately, insolvency. We were brought in to assume day‑to‑day leadership and execute a rapid turnaround, stabilizing the business, restructuring obligations, and protecting as much going‑concern value as possible in a shrinking, highly competitive market.
Three Keys to Success
Addressing the Product Portfolio
The company had ridden a single hero product through its initial growth, which capped revenue and made it vulnerable to competitors. We expanded the portfolio with a lower‑cost option for entry‑level DJs and a new line aimed at home and mobile‑worker ergonomics. We also introduced new color variants that created a “collectability” effect with core fans, meaning higher average order values and stronger customer lifetime value.
Moving to OmniChannel
At the start of the turnaround, sales flowed almost entirely through global music‑equipment distributors. We stood up a direct‑to‑consumer ecommerce channel, launched a web store, and added Amazon and eBay. In the US, we replaced broad wholesale distribution with a focused rep model for key retail chains, while smaller accounts ordered through a wholesale web portal. The shift to an omnichannel model was a major contributor to the return to positive cash flow, with healthier margins and better control over customer relationships.
Transparency with Creditors
When we arrived, the company was in default with its bank, and several private investors had provided short‑term financing but were largely in the dark. We adopted a policy of full transparency, sharing a clear plan to restore sustainable cash flow along with regular operating updates. That communication reset relationships with lenders and investors and bought the time needed to complete the turnaround without a bankruptcy filing.
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