Turnaround – Bruno Promenzio

Mattress Industry

Admin — Fri, 21 Feb 2025 17:04:30 +0000

Second biggest company facing a profitability challenge

Initial Situation

Low Margins
Second biggest company in the sector
+ 940 employees
Elevated working capital cost
Long-term receivable (~120 days)
High dependence on large retailers

Strategy Designed

Reduce Dependence on retailers
Staff Optimization (economy – €4MM) – from 940 to 563 employees
Administrative Headquarters Change (economy -€336 k)
Variable remuneration model
New Strategic Business Model
Value Chain Domination
Focus on small retailers (more margins and minor cash cycle)
Creation a new business model (franchising)
New products launch
R&D
Product Pipeline Review

Results

Dependence on large retail fell from 67% to 37%
3 lines of production are reduced, impacting directly
17 new stores in the first year
Profitability went from 4% to 14.5%
Cash cycle reduced for 47 days
Working capital need reduced impacting directly on cash generation
New Capital from banks
Debt restructured

Outsourcing Services

Admin — Fri, 21 Feb 2025 16:35:01 +0000

Traditional Outsorcing Company that provides workforce for big companies, hiring, training and managing.

Initial Situation

Negative and low contracts margins
High revenue and low margin
High need for working capital to finance the structure
High payroll
High turnover cost
High bank loan rates

Strategy Designed

Reduction in bank loan rates
Focus on cash generation
Turnover reduction through better hiring process
Personnel Optimization
Increase in contracts
Contract Renegotiation

Results

16% drop in revenue
24% increase in operating margin
Staff optimization
Active expense management
Fixed cost reduction by 12%