17 June 2018
A retailer with six large shops and a web shop that processes domestic and cross-border orders and generates a sizeable part of the turnover. The company sells its own brand product in addition to several other well-known brands. It’s a family company in the hands of the third generation, and members of the fourth generation work throughout the company.
Turnover was shrinking, and the company was making a loss. Liquid resources were extremely limited. On the advice of its bank—the non-performing accounts department—the company engaged Gwynt to diagnose the situation, assess the business model, calculate a cash flow forecast, and formulate a recovery plan that included measures for improving sales and profit.
In just four weeks, we conducted a quick scan of the internal and external causes. The scan was based on market and competition analyses, interviews and workshops with management and department heads, store visits, a website and social media assessment, and financial analyses and forecasts.
Once the scan was complete, we decided which measures should be taken with regard to sales growth, cost reduction, internal organisation, processes improvement and cash & financial management. A budget and cash flow forecast was drawn up, and then we discussed the recovery plan with the directors and the bank.
The company accepted all our recommendations, which included the recruitment of an interim director. The interim director worked hand in hand with the managing director/major shareholder to bring structure and calm to the management team and the rest of the internal organisation. As a result, logistical processes and stock management have improved, old stocks were cleared out, and cost savings were carried out.
A new website was tested and launched successfully, and one of the branches was turned into a thriving outlet store. The e-commerce and marketing teams were integrated, and more attention has been given to personnel policy and communication to staff about the improvements taking place. In addition to all the short-term measures, a start has been made on drawing up a strategic plan for the next two to three years.