Restoring Profitability at a Second-Generation Aerospace Manufacturer

The Situation

The company was a well-established manufacturer of aerospace components, built by its founder into a consistently profitable business over decades. The founder ran it largely on instinct. He knew his customers, his shop floor, and his cost structure well enough that he rarely needed a financial statement to make a decision, and for most of the company’s history that worked.

Two things changed. Leadership passed to the founder’s son, whose strengths were in sales and customer relationships rather than plant operations, and who needed the numbers his father never had to look at. And the company’s longtime CFO, who had earned the family’s complete trust, fell ill and gradually stopped producing financial statements altogether.

The family, loyal to a CFO who had served them well, did not push. For roughly two years the company operated with no reliable P&L, no balance sheet, and no forward view of cash. The new CEO was running a manufacturing business with a meaningful cost structure and no way to see where the money was going.

The Challenge

Without visibility, the business drifted from profitability into losses that compounded for several years and reached into the millions. Nobody could say which jobs, customers, or product lines were losing money, so nothing was fixed.

The founder covered the shortfalls personally. Each capital infusion kept the company operating and each one deepened the strain on the family. The founder was watching a business he had spent his life building consume his capital with no visible path to recovery. The son was running a company he could not see into. The family had no shared set of facts to make decisions from.

A prior advisory firm had been brought in to reconstruct the financials and stabilize the function. It did not succeed, which left the family more skeptical of outside help and further behind.

The specific problems Buxbaum inherited:

• Approximately two years without financial statements and no functioning close process
• No job-level or product-level cost visibility in a business where margin lives in individual parts and programs
• No cash forecast, with capital needs surfacing as emergencies rather than plans
• Inventory and WIP balances that had not been reconciled or tested
• A leadership team and a family board making decisions without common information
• A previous failed remediation and the credibility gap that came with it

What We Did

Buxbaum placed an interim controller into the company, working on-site alongside one of our operational consultants. The controller owned the accounting function outright: rebuilding the close, reconciling the balance sheet, establishing cutoffs, and producing monthly financial statements within seven business days the leadership team could rely on.

The operational consultant focused on the numbers that actually run a machine shop. Working with production and estimating, we built job costing that tied labor, material, and overhead to individual parts and programs, and produced operating metrics granular enough to show which work was profitable and which was not: margin by customer and part family, labor efficiency by work center, scrap and rework, on-time delivery, and backlog converted into a revenue and cash outlook.

With a functioning ledger and job cost in place, we built a rolling cash forecast that replaced emergency capital calls with a planned view of funding needs, and we reported it to the family on a set cadence so the founder could see the trajectory rather than react to the next shortfall.

The reporting was designed for the CEO’s strengths. He did not need to become an operator overnight. He needed a dashboard that told him in real-time where margin was being made and lost, and a controller who could explain why. Given that information, the sales instincts that made him effective with customers became an asset in pricing and in choosing which work to pursue.

The Result

Within twelve months the business returned to its historical level of profitability. The turnaround did not come from a restructuring or a new strategy. It came from the leadership team finally being able to see the business: unprofitable work was repriced or declined, cost overruns were caught at the job level while they could still be corrected, and cash needs were forecast rather than discovered.

The founder’s capital infusions stopped. With a professional cash forecast and a transparent expense structure, the family had a shared view of the company for the first time in years, and the stress that had built up around each funding call eased considerably.

The company now operates with formal governance. The board meets on a regular schedule with a complete financial package, operating dashboards, and the metrics needed to set direction. The family is aligned on how the business is run and confident that the legacy the founder built is intact.

Why It Matters

This engagement is a clear illustration of something we see repeatedly: the difference between an owner-operator with good information and one without is often the difference between profit and loss, with no change to the underlying business.

The founder did not need financial statements because he carried the numbers in his head. Very few second-generation leaders can do the same, and they should not have to. Timely, accurate, granular operating information is what lets a capable leader without a founder’s instincts run the business as well as the founder did. It is also what lets a family govern together rather than argue in the dark.

If your company has lost visibility into its numbers, whether through a departure, an illness, or simply growth that outran the finance function, the losses that follow are not inevitable. Let’s talk about what it would take to see your business clearly again.