Gilchrist: The Bankruptcy Hits Home

John Wolz

�It may be the best thing that happened out of the whole thing,� Robbie Gilchrist said of the $100,000 scholarship donation he and his wife, Gina Gilchrist, made to the National Fastener Distributors Association scholarship fund.
The Gilchrists made the donation from proceeds of the 1999 sale of his Capital Fasteners Inc. distributorship to Questron Technologies Inc.
The donation is his highlight of selling his business to Questron.
With Questron filing for Chapter 11 bankruptcy, the stock Gilchrist received for Capital is probably worthless.
Most of the cash from the sale went to paying off company debts, attorneys and taxes, Gilchrist said.
Others who sold to Questron for all stock may now be much worse off, he observed.
Gilchrist isn�t counting on getting any more money from Questron. �There is a wild-card chance that a bone could be thrown to stockholders in later stages of the bankruptcy,� Gilchrist said. But it would probably only be 3� on a stock that many people in the fastener industry bought at about $10 a few years ago.
He isn�t optimistic about Questron under new ownership. Gilchrist cited statistics that 85% of companies fail after bankruptcy.
�The management of Questron hasn�t been very successful,� Gilchrist added.
He left as regional vice president last year, because Questron management wasn�t accepting his advice. �I built a pretty good company, and they wouldn�t let me help,� Gilchrist explained. �They thought they knew how to run a fastener company and that I didn�t.�
Questron�s official statement assures customers it can continue to provide fasteners. But Gilchrist said many vendors might lose money in the bankruptcy, and several he has talked to are increasing prices to Questron and requiring cash in advance.
Despite his losses, Gilchrist is looking ahead. He started a business once and is still young enough to do it again.
He said, �Knock on wood, I�m still lucky.� Last week one of Gilchrist�s golfing buddies, the chairman of a local bank, died of a sudden heart attack at age 51.
�Life ain�t always easy,� Gilchrist sighed.
His advice to fastener entrepreneurs wanting to sell to consolidators is to �ask for cash in the hand or stock from a Fortune 500 company that is freely tradeable.�
Since leaving Questron last spring Gilchrist has been doing some consulting work for southern distributors and is now forming a rep agency, Capital Marketing. It is located at 200 Fisher Ave. #101B, High Point, NC 27262. Tel: 336 884-1704 Fax 336 884-1778 Cell: 336 906-9401 E-mail: rgilchr485@aol.com \ �2002 FastenerNews.com