One Stop Systems Initiates Saving of $3 Million With Reorganization

One Stop Systems, Inc. (OSS) initiated a structural change and expense reduction designed to align the company’s operations and goals with current market uncertainty while positioning for future growth.   

The company expects the program to be substantially complete in the current quarter and realize savings of $2.5 million to $3 million on an annual basis.

This initiative involves immediate selective workforce and expense reductions company wide, including at the senior management level. Other key changes include consolidating acquired operations and realignment of managerial responsibilities.
  
Earlier this year, the company’s board of directors implemented a change in senior leadership to deploy a different skill set for taking OSS to its next level of growth and development. This reorganization and expense reduction program reflects the combination of changes planned under the new leadership and the company’s response to current market conditions resulting from the COVID-19 pandemic.

OSS director and interim CEO, David Raun, has been working with the entire management team, with the near-term goal of cash preservation and sustainability, and long-term objectives of improved margins, profitability and shareholder value.

“Looking beyond the short-term goal of ensuring sustainability during these uncertain times, we are laying a stronger foundation for the future,” he commented. “While our sales team remains optimistic given the current level of customer activity, we realize we must plan for the possibility of an extended period of business retraction. I believe that with our diligent team effort we will get through these challenging times and come out stronger.”

Concept Development, Inc. (CDI), which OSS acquired last year, has been now fully integrated, with its operations being relocated to OSS HQs in Escondido, CA. The operational synergies have created instant cost savings and supports stronger collaboration and innovation.

To better capitalize on market opportunities and create greater shareholder value over time, the company has intensified its focus on product marketing ownership. The product marketing team is now the hub for cross functional coordination with sales, engineering, operations and finance.

This team will be responsible for creating additional checks and balances within the company in terms of key decisions that impact revenue, margins, profitability, product road map, type of customer and market focus. They will be responsible for creating additional value and customer stickiness, as well as discipline while leveraging the company’s expertise and capabilities in a more coordinated way.

The team will also be focused on improving margins by reducing cost of goods sold, and reallocating resources internally to help drive forward this important part of the plan.

“As the result of these changes, I believe we have become more operationally efficient and integrated with a ‘lean and mean’ team leading the way,” said Raun. “Over time, we expect to add fresh talent who will bring new ideas and skill sets to help fuel our growth.”

“With these improvements in place, we will remain focused on three key objectives for 2020,” he he added. “First, we will continue to invest in and improve our industry-leading product roadmap. Second, we will expand our customer base and reduce customer concentration risks by focusing more on targeted growth markets where we have competitive advantages. And third, we will improve how we deploy our financial assets and increase efficiencies.“

In combination with its efforts to reduce spending and conserve cash, the company is pursuing opportunities to further strengthen its balance sheet with the combination of government and private financing sources. Any funding will be designed to support the company’s sustainability during these times of uncertainty and support its pursuit of new opportunities.

Read also:
David Raun Interim President and CEO, One Stop Systems
Succeeding Steve Cooper
February 19, 2020 | Press Release
Revenue up 57% to $58.3 Million in FY19 for One Stop Systems
Increasing 28% from 3FQ18 to 4FQ19
January 23, 2020 | Press Release