BUSINESS PROFILE

A retail greengrocer, coffee bar, market outlet and delivered greengrocer’s business.

THE CHALLENGES

The business faced the challenges of several major multiple supermarkets in the immediate geographic area which had eroded the volume of sales from the High Street and considerably reduced profit margins across all areas of the business. Wholesale business was operating on very low gross profit margins

GOALS

To improve the profitability levels of the business to move it from loss making to profit making

THE STRATEGIES

Following a mystery shop of their various competitors, a full review of their cost and selling prices was undertaken. Sales prices were moved up in line with the results of this mystery shop. The cash flow within the business was assessed and, although all areas have been improved, key attention was focussed on the supplier terms which have been lengthened thus helping the cash flow in the business. Management reports were produced to provide transparency on the financial performance of the various operations within the business enabling decisions to be made based off their individual profitability. A new client process has also been successfully implemented, which has delivered new customers boosting the turnover.

THE OUTCOMES

Overall gross profit margin in the business has increased by more than 20 %. Sales which had been falling were stabilised and then modestly grown. The business moved from making material losses into profit. The owners, who had been subsidising their business no longer had to pump their own money into supporting it and subsequently were able to sell it and retire.