Group of companies that were expanding rapidly, but the Managing Director had no idea of by how much. Financial information was out of date and inaccurate. This caused difficulties in reporting to shareholders.
Losses were in excess of €0.5 million, turnover in excess of €10m and the cash flow was extremely tight. The lack of information meant that there were difficulties in securing funding from banks, leading to continuous pressure on the ability to pay creditors.
Davis Business Consultants were brought in on the case.
- Introduced detailed reporting – daily, weekly and monthly
- Introduced detailed budgets
- Introduced counter-pilferage measures which had a direct impact on turnover.
- Introduced cost savings, reduced direct wages and overheads.
- Focused on product purchasing so as to increase the per unit profitability to a business which had in excess of 200,000 units.
Result
- Turnover was increased by 120% to in excess of €22 million.
- Expanded from 45 to 60 stores nationwide.
- Profits exceeded €2 million
- Personal wealth of the Managing Director grew from €2 million to €24 million.
- €35 million of funding was secured from the banks, which was used by the business and the shareholders to fund business growth and personal wealth through property purchases.