August 19th, 2020
Dave Smith brings three decades of high-level financial experience as a strategic partner to the WMEP Manufacturing Solutions team.
“The main thing that I do is handle financial consulting, which is a niche that WMEP doesn’t have on their full-time staff,” said Smith, who serves as chief financial officer of Milwaukee-based Koss Corp., a manufacturer of high-fidelity headphones. “I’ve been in financial and operational roles for 30 years now and most of that time as a CFO in public companies, private companies and private equity backed companies. I’ve worked for manufacturers as small as $50 million up to hundreds of millions of dollars.”
Smith began providing financial consulting services to WMEP about three years ago, working on a variety of smaller projects for the organization.
He has taken on an expanded role with WMEP through its Discover2Recover project.
Under the CARES Act, WMEP Manufacturing Solutions received a grant to help small and mid-size manufacturers analyze their current situation and take advantage of proprietary financial and business tools and expertise available under the program.
Smith and WMEP have assembled a team of the areas brightest financial and business growth minds to provide deep-dive financial and operational assessments for manufacturers.
WMEP, in partnership with Smith and his consulting business, DSmithCFO, has designed a confidential and secure assessment that leads to recommendations to increase cash flow, stabilize and increase cash reserves and give companies added time to address operational concerns.
“Right now, WMEP has nearly 40 contracts,” Smith said. “I’ve got a really good group working with me, so we could handle a pretty heavy workload.”
The assessments of manufacturers have generated an array of results.
“It really varies from client to client,” Smith said. “We have some clients where sales have dropped drastically due to the Covid-19 pandemic. We’re trying to figure out what to do about their sales and overcapacity and them having too much inventory and cash flow issues. We also have clients that are growing rapidly and have the opposite problems and are running into capacity issues because of that growth.”
The coronavirus pandemic continues to have an impact on the state’s manufacturing sector and the Discover2Recover assessments can be essential in helping companies deal with the challenges, Smith stressed.
“It has caused clients problems one way or the other. But our major focus has been on the ones who have been negatively affected and how they respond to that challenge,” Smith said. “It could be questions with collection of receivables, issues focused on availability of credit, payments to vendors, and ways of reducing inventories. A lot of different topics but almost all are focused around cash generation.”
Manufacturers are concerned about the current environment, but few are panicking, Smith said.
“But certainly, there are situations where they are thinking if we can’t turn this around in the next three to six months, we’ve got a major problem on our hands. I wouldn’t say companies are panicked. It’s much more rational. They want some ideas as to how they can fight their way out of this.”
Dave Smith, CFO
In conducting the assessments, WMEP requests that clients provide year-to-date financial information, as well as financials from the previous two years.
“Then we have a very structured interview process we go through to cover all their operations. That should uncover any significant issue,” Smith explained. “We then rate each issue on its level of risk. If there is a high concern, then there is a recommendation of what they can do to resolve that issue.”
Once the structured interviews are completed, Smith and his team then work with clients to ensure that they are comfortable with their recommendations before a final report is issued.
Smith previously served as chief financial officer at Milsco Manufacturing in Milwaukee, ALKAR-RapidPak in Lodi and Morris Material Handling in Oak Creek. He also served as vice president and controller at Harnischfeger Industries in Milwaukee.
The native of Hershey, Pennsylvania, currently resides in Door County with his wife, Sally, and has been handling many of his duties remotely.
Away from work, Smith is an avid long-distance runner, having completed half-marathons, 50-kilometer trail races and multi-day trail events. He also enjoys traveling and spending time with his grandchildren.