CASE STUDY ON ONE OF OUR CLIENTImporter of Alcoholic and Non-Alcoholic Beverages

importer
Business of Client:

Importer of Alcoholic and Non-Alcoholic Beverages

Challenge

Challenges faced by the company

  • Irregular sales growth and low movement of products
  • The higher cost of operation,
  • Low profitability and negative ROI in 3/5 Years,
  • Liquidity concern and delay in salary payment,
  • Promoters were not content to continue business

Review and Action plan

Procedures Review

  • Import Process,
  • Cost Structure,
  • Pricing,
  • Sales plan, approval and accounting

Interviewed Team

  • Management,
  • Managers,
  • Sales team and operation team

Study various plans

  • Management Strategy
  • Finance mix,
  • Financial Statements & Managements reports

Our Findings

Importation

  • Order Plan was not properly planned and implemented,
  • Overstayed products in bonded Warehouse

Sales

  • Routes were not defined without a route plan,
  • Poor customer management system,
  • Products pricing was not done properly,

Cost

  • Fixed and variable cost not classified,
  • No budgetary control on fixed cost,
  • Higher Percentage of fixed cost in total cost

Debtors

  • Account opening form not properly recorded and authorized
  • Wrong data and documents of debtors,
  • Poor debt collection system,

Operations

  • Vehicle profitability analysis never done,
  • Higher vehicle running and maintenance cost,
  • Centralized control without proper responsibility,

Incentive plan was not formalized

Execution Plan

Importation

  • Ordering plan linked with sales plan,
  • Re negotiation on Sea freight and insurance charges,
  • Bond charges and clearing charges re-negotiated and brought it down

Sales

  • Worked with sales plan,
  • Classification of customers,
  • Focus on category A customers,
  • New Routes plan,
  • Dynamic product pricing with price negotiation power to senior mangers

Cost

  • Cost split in fixed and variable cost,
  • Lease rent and other fixed cost tried to re-negotiated,
  • Vehicles which were old, incurring huge running cost and not required were sold,
  • Insurance cost on vehicles renegotiated

Debtors

  • Appointment of Debt collector,
  • Strick KYC compliance and action against staff opened account without KYC,
  • Procedure established to open debtors, credit limit, and system of collection

Operations

  • Sales target for vehicles fixed with fuel budget and fuel card system brought instead of cash fueling,
  • Incentive plan was fixed for sales team,
  • Team building Motivation training organized for staff

RESULTS OF OUR ACTION PLAN

  • Exponential growth in sales ( 50% higher than the previous year period),
  • Liquidity improved and suppliers are getting money on time,
  • Significantly reduction in Cost of operation (about 20%),
  • Debtors Outstanding reduced with lower collection period,
  • Timely updating of accounting books and statutory returns,
  • Lower stock difference incidences,
  • Team highly motivated and confident to achieve sales and business plan

how can we help you?

Contact us at the Consulting WP office nearest to you or submit a business inquiry online.

I first heard of Bloom Global from a friend who had his Tax issue resolved by them. Knowing very well my weakness in budgeting and handling Financial activities, I decided to contact them. As a young Entrepreneur who is determined to grow my business in this competitive marketing Industry, I thought it was wise to outsource their professional services and that way I would save on hiring a permanent staff and also get Professional advice in growing my business. I am content with their services and glad I took this path as I now see my business from a different perspective and positive of its growth. I would definitely recommend you to hire them.

Nicolas Chacha
Founder CEO, Foxford Limited

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