BUSINESS TURNAROUND – SG&A optimisation

  • BACK TO PROFITABILITY
  • SG&A COSTS REDUCTION

ORGANISATION

  • Global Fire & security company (NYSE Fortune -500) – (sales $12B)
  • region Global Operations, EMEA – (sales $250M)

project SCOPE

  • Bring Region back to profitability
  • Significantly reduce SG&A (and other back office) costs

project GEOGRAPHY

EUROPE
Sweden, Norway, Denmark, Finland, Greece, Poland, Hungary, Czech Rep, France, Spain, Benelux

FINDINGS

  • non-key markets with average EBIT at 2% level (for some countries even negative).
  • Poor procedures and controls
  • Management focused on top line (sales) instead of bottom line – EBIT and Cash Flow
  • Operational inefficiencies

CHALLENGES

  • 12 Legal Entities in different countries
  • get EBIT back closer to the 10% company target
  • Demotivated staff
  • Tax complexity
  • Time Pressure
  • Management believing that Sales is more important than positive EBIT

ACTIONS

  • situation audit (processes & profitability)
  • business restructuring in whole region to make it more resilient for economic turbulences /turndowns
  • 2 year improvement plan/roadmap
  • sales portfolio optimization
  • ensured delivery of Plans & Strategies
  • integrity of all financial requirements (general accounting, period-end closing, Group reporting, statutory reporting, controlling forecasting and budgeting)
  • control framework implementation and compliance with SOX and Group Policies

DELIVERABLES

  1. Uplifting regional EBIT to 7% ($10m)
  2. Stock reduction by $2m
  3. Reduced Stock provision level by $750k
  4. Collection of $4m long term overdue AR
  5. improved job costing
  6. getting the region out of the HQ list of trouble makers.
  7. standarized and simplified processes and procedures
  8. Elimination of the loss making projects/clients from sales portfolio
  9. overstaff elimination (-200 FTEs)
  10. new motivational sales scheme
    • to ensure responsibility, for drop of original GM and collection

EXPERTISE APPLIED

Finance & Accounting

  • Strategic Fin. Planning, Execution
  • Budgets/Forecasts/Actual P&L/BCF
  • FP&A, Statutory, Group Reporting
  • Financial and reporting discipline

Business Turnaround

  • Portfolio evaluation & optimization (sales)
  • GM optimization (operations)
  • Back office costs optimization (SG&A):
  • Restructuring & Process Improvement
    • Centralization
    • Regional Shared Services (SSC/BSC)
      • creation, transition, management,
      • continuous improvement

Change management

  • addressing staff concerns,
  • facilitating cultural alignment
  • operational processes streamlining

Project management

  • proper process planning
  • roadmaps preparation and execution
  • efficient resources allocation

DOWNLOAD FILE

Business Turnaround – SG&A optimisation (pdf) – less than 1MB

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