Larry Rosolowski joined kick scooter maker Razor USA LLC in 2006 when it was still a budding business.
He has since helped establish a solid platform of financial and risk-management procedures upon which the company has grown into a global household brand for scooters and other toy products.
Razor, which was founded in 2000, manufactures various types of wheeled sporting goods, including its signature kick scooters, as well as electric scooters, dirt bikes, pogo sticks and accessories.
It had $90 million in sales about nine years ago when Rosolowski joined as chief financial officer, and just last year it logged $315 million.
Rosolowski was honored at the Business Journal’s CFO of the Year Awards on Feb. 4 in the lifetime achievement category (see related stories, pages 1, 4, 6 and 9).
“My experiences at Razor have been a little bit different every year,” he said, noting that his initial challenges were to improve the accounting system and build internal processes.
“The financial reporting and accounting system was not in good shape the first few years,” he said. “We established better processes and procedures to give management better analytical management. From there, we moved to managing pretty rapid growth.”
Foreign exchange management was also an area of critical importance to Razor, whose manufacturing operations are in China.
“When the Chinese currency started moving against us, we developed foreign currency hedging strategies to defer or delay some of the impacts of the Chinese currency becoming more valuable,” he said.
Razor has been in the hedging program for almost two years.
“In the first year … we saved the company $1 million,” Rosolowski said. “And with the way the Chinese currency has been behaving, our recent gains weren’t as big as last year, but in a way that’s not really bad news. It just means the currency hasn’t been moving against us [as much].”
Cerritos-based Razor has about 40 employees in China, part of its overall workforce of about 135.
A more recent project for Rosolowski and Razor is an upgrade of its Enterprise Resource Planning, or ERP, system.
“It’s really become obvious that we needed a new accounting system,” Rosolowski said. “More broadly, we needed a new ERP system. We just have been struggling along with the system that doesn’t do enough for us, making a lot of our efforts manual and more prone to error, more difficult to work with.”
Implementation of new EPR systems can become costly and time-consuming, and Rosolowski called it “an investment in the future of the business.”
“We’ve been considering it for the last couple of years,” he said. “We are now in the final phases of the vendor selections. It will be about nine months to a year of implementation.”
ERP upgrades fall squarely within the responsibility of the finance chief, who is “close to the data,” he said.
“It’s important for the CFO to be smarter about the company,” he said. “We should be able to see data and identify opportunities for improvement for managers so that they can take action. Therefore, we need to understand the business as well as they do. It’s … very much a broad business role, not just numbers.
“[The ERP system upgrade] can help, for instance, identify data that’s out of whack, or make alerts if a margin on a certain product is drifting negatively. Rather than management having to look through all the data, the system is set up to make alerts. It helps you to have a leaner management team and leaner accounting staff but still keep good eyes on the business.”
Rosolowski, an Ohio native, studied at Ohio State University and worked for about seven years for Coopers & Lybrand, which is now part of PricewaterhouseCoopers LLP. He then went to the University of Michigan for an MBA, after which he joined Eastman Kodak Co. in Rochester, N.Y.
He moved to Redondo Beach in 2001 when he was recruited by a graphics and production company, which he helped get off the ground.
He then worked with Los Angeles-based private equity firm Aurora Capital Group from 2002 to 2006 to help in a turnaround effort for Impaxx Inc., a packaging and labeling equipment company.
“And I came to Razor after that,” he said. “They were still a pretty young company when I joined. Part of the attraction was that there was a young company that needed internal control and processes, but we didn’t want to squelch the entrepreneurial spirit that was here. That was really critical.”
Rosolowski said Razor is continually working on new products, but “getting that big new product is always a challenge.”
“We feel like we thought of every way out there to put a kid on wheels,” he said. “If we’re going to continue to grow, we have to come up with other ways.”