Challenge
BFS’ strategic goals for revenue growth depended on the ability to retain and grow sales. Its marketing efforts produced results that even surprised ownership, and within three months, it had a backlog of over $20-million in orders. While this represented quotes to potential buyers, it became obvious to management that it would soon outgrow its existing 15,000-square-foot facility and would need to invest in automation equipment if it were to meet this demand. Ownership had located a site in neighboring Nevada and began planning to move out of California. While the acquisition resulted in the saving of 14 jobs that would have been lost if the previous ownership liquidated the company, California was faced with losing not just these 14 jobs, but any additional new jobs as the company continued to grow. Had it been liquidated, the state of California would have also lost sales tax, property tax, and income tax revenues.
Solution
BFS engaged CMTC to assist in planning the move, help design new processes that would incorporate automated equipment, and assist in developing a strategic plan with financial projections that would enable it to obtain the finances needed to make the move. CMTC also helped by introducing BFS to the Cal Competes program managed by the Governor’s Office of Economic Development. This program provides California income tax credits to companies that agree to remain in California and relocate to an area of high unemployment within the state. CMTC provided assistance in completing the application on behalf of BFS and worked with management in locating alternative sites within California.
Impact
In April 2020, the company received formal notice that they have been awarded $2.3 million in tax credits for relocating its facility within California. Management found two potential sites and CMTC proceeded in assisting with the financial, logistical and layout planning for the move. To qualify for this award, BFS outlined its planned growth and capital expenditures over a five-year period, which included the hiring of an additional 10 employees in 2020, and to have 31 employees by the end of 2024. With a total payroll in 2020 in excess of $350,000, the economic impact on the community using a multiplier of 5 will be more than $1.7-million.
CMTC has been an integral part of helping Bryant Fuel Systems, LLC become one of the premier above ground fuel systems manufacturers in the world. Their knowledge of best practices and understanding about structure, process and financial discipline will enable BFS to take advantage of opportunities across many industries for many years to come.”
— David Wells, President and Owner