Turnaround in a £25mn ( 40 outlet) pub and restaurant business
Background
I was introduced to the business by the lender, a major bank, “to assist” within this group under threat following a recent under-performing acquisition and a general decline in the leisure market.
The business had been the result of a recent IBR but the position had deteriorated subsequent to this.
While the organisation had the options of who to accept in this role it was undoubtedly seen as an imposition and a further drain on their perceived limited resources.
After some delay I entered the business in early January following disappointing Christmas trading
Key Challenges
With forecasted profit and subsequently cash position £750k worse than predicted within the IBR and cheques in the drawer amounting for £1.25m – Cash was the significant priority.
The senior management team were in denial and there was increasing tension between the CEO (majority shareholder) and the FD.
Relationships between the Bank and CEO were poor.
Other members of Management had not been kept in the loop and as a consequence were not engaged in prioritising the key actions.
Capability and attitudinal issues came to light quite quickly as the management team became more involved and engaged.
Main Actions
Stabilised cash position and introduced robust cash and profit forecasting and cash management processes/models.
Introduced weekly management meeting chaired by CEO and through this developed a Business Profit Improvement plan alongside weekly site and trading group performance reports.
Exposed capability and attitudinal issues within Management Team
Drove new Business plan process and strategic discussion on portfolio.
Managed Bank relationship ensuring a no surprises dialogue for all parties.
Main Results And Achievements
Managed the CEO and the Business in dealing with the reality of the situation
Achieved trust and respect of CEO in a short period and in conjunction with him revised senior management and roles.
Completed a total restructuring of the Finance Team including new Finance Director.
The profit improvement plan produced improvements of £875k p.a.
Used robust business plan to deliver a restructured debt package including a brewery loan to replace more onerous bank debt.
Returned Bank relationship to normality.
Delivered robust and sustainable systems and management team.
Provided ongoing business mentoring on various matters for a further twelve months.