Revitalisation of a Chocolate Manufacturing, Wholesaling and Retailing Business
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Revitalisation of a Chocolate Manufacturing, Wholesaling and Retailing Business
“Secantor have made a world of difference to our business – we are now in control ... It’s been a transformation of the higher level work within the business ... It’s a very cost effective way for us to have high level management and strategic help”
Background
The client is a husband and wife team, former solicitors, who took time out to tour South America. This gave them the inspiration to return to the UK to start a new business. Nine years later they now make chocolate organically and trade fairly through hundreds of shops via wholesalers, multiple retailers eg. Waitrose, their own five stores in SE England and online retailing. A complex business for a two Directors to micro-manage.
Helen Pattison of Montezuma's Chocolate tells the story of the business. (6 min)
Issues
The business was well established with a successful brand loyalty and exciting innovative chocolate products but in 2008 financial pressures highlighted the need for more urgent action to control cash, stocks and profit margins. The team’s bank manager sensed there was also more business potential to be un-locked suggested that they should meet Secantor.
Actions
In April 2008 a Secantor FD with experience in food processing, wholesaling, High Street retailing and on-line retailing joined the team on a part-time basis. The following has been achieved with Secantor’s assistance:
A strategic review of the various parts of the business was undertaken providing direction through a structured business plan and financial projections. Budgets were prepared to plan, monitor & control future developments & growth.
Management accounts and forecasts were re-organised & KPI’s were established for decision making as part of structured monthly Board meetings in which accountabilities were introduced for each member of the management team.
Two significant loss-making shops were closed and improvements to staff productivity, merchandising, customer service, sales and margins were achieved in remaining stores.
New funding was justified and obtained from the Bank Manager in Summer 2008 to provide working capital ahead of the peak Christmas trading period.
The factory planning, methods and controls were improved through tightened disciplines and strong supervision.
Market research and planning was developed resulting in substantial product range and stock holding rationalisation.
The Internet retailing side of the business was scrutinised and re-developed.
Outcome
A loss of £400k in 2008 was turned around and is on budget to achieve a £200k profit in 2009. Sales are forging ahead in the face of economic recession.
