Recovery Implementation Case Study
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Full speed in reverse
Philip started and operated a highly successful chain of MOT testing stations. His concept of a "Test-whilst-you-wait "and " No pass, no fee" proved highly popular with customers. He was able to draw a comfortable salary and his family began to enjoy the good life. Thus encouraged to increase his earnings further, Philip devised a grand scheme for a co-ordinated motor services group and acquired a parts wholesaler, a fleet sales operation, two dealerships, a petrol station and a villa in Spain.
In short, he overreached himself managerially and financially. His preferred management style of being on the ground was no longer possible. He relied on managers and in particular an accountant to tell him how he was doing. These let him down, big time. Cash was haemorrhaging, the bank was alarmed and the suppliers were not paid.
Introduced by his accountants, we carried out an urgent business review. This identified that the priority was to generate cash and that the new businesses were not contributing. Philip had anyway become anxious about what he had created and wanted to roll the clock back to his original business.
The first step was to get a grip of cash and reassure the bank. Philip did not have the accounting skills available in house and it was not realistic for us to become his full-time FD. We therefore introduced some suitably qualified candidates for an interim manager, who quickly installed basic monitoring systems and helped with the disposal process. We attended a fortnightly review meeting and accompanied Philip to the bank meetings, where our support and reputation could be bought to bear.
It was not all plain sailing but in due course the eventual goal was reached.
"Interim management can provide the expertise and time that you lack in a cost effective way. However there are many people offering these services with varying quality and track record. In our role, we have real experience of many such people and can make effective introductions. "
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