G-F turns a page

Tuesday, May 31, 2005

ATLANTA -- If Graham-Field's embattled CEO Irwin Selinger loses his appeal and goes to jail for 18 months, company officials insist that Graham-Field will weather the loss of its current CEO.
"The company has been preparing for all possible scenarios for some time," Lawrence de la Haba, vice president of marketing at Graham-Field, said in a statement release a few days after a federal judge sentenced Selinger. "Graham-Field has already implemented a new strategic plan that involves the creation of three business units reflecting the three distinct markets in which the company competes."
While Selinger's fate hangs in the balance, Graham-Field maintains that its perilous days are over and the company is on the track to financial well-being and long-term viability. Some of the company's customers are saying the same thing.
"I wouldn't say the comeback is over yet," said Alan Landauer, president of Landauer Metropolitan Care, which employs more than 200 people in Mount Vernon, N.Y. "They still have work to do. But they are moving in the right direction."
For the first time in years -- indeed since the 1990s -- Graham-Field is saying it's concluded a quarter with a profitable EBITDA. Sales are closing in on a run-rate of $100 million annually, said G-F CEO Selinger. The days of not being able to fulfill orders and compete on price are over, say company officials.
"We have the lowest backlog this company has ever had, not only since I'm back but in its entire history," said Selinger.
The end of April marked the second full year of business for Graham-Field since the company was bought out of bankruptcy for $28 million by a New York banker named Moses Marx. Coincidentally, with sales revenues of just $4.5 million per month that first year, Graham-Field lost $28 million during Selinger's first year back.
Concerned about the degeneration of product quality since he left Graham-Field in 1998, Selinger said he halted shipping on the company's bread-and-butter products through his first four months on the job while the DME line went through a redesign.
The fruit of G-F's potential is now ripening, according to Selinger. The company recently rolled out a new semi-electric and full-electric bed that costs 40% less than it did two years ago. They spent $1 million on a new in-house computer system, and $200,000 for a new catalog. The Web site is also new.
"We're about to announce that we are introducing a complete new line of tilt and recline power systems that are going to be assembled right at the dealer and sell for half the price of the going tilt and recline," said Selinger. "We're investing millions in that project.
For Landauer, G-F is now the company's third or fourth largest supplier in terms of dollar volume. Landauer is an old G-F customer, and for his company, doing business with Graham-Field again has been a little bit like slipping on a familiar, old sports coat.
"Basically, because of the force of Irwin's personality, we ended up going back to doing a considerable amount of business with them," he said. "We're the easy people. The challenge will be to develop a sales presence with the majority of dealers."
On that front, so far so good, said Jim Myers, a new customer at Carolina Medical Supplies in Spencer, N.C.
"In the few months I've been with them, I have had good results," said Myers. "The customer service seems to be on top of things. If I call my rep about needing something, he's right on top of it."