Fighting back in a retail squeeze
A major retail company faced a situation where a major turnaround program was inevitable to address performance issues and deteriorating market position. Together with the client team, August identified a very challenging but realistic path to profitability and growth. A year later, the company was once more profitable and had reclaimed its position as a Nordic leader.
Interested in hearing more? Contact Tomi Ere
Challenge
The company had seen its profitability plummet during the past few years. Its business environment was changing rapidly and the value chain was evolving. This had created disruptions in its traditional revenue streams and squeezed its margins almost to the point of vanishing. In addition, the company was suffering from a series of internal challenges including lackluster cooperation between key functions and a scattered customer segment focus.
Brave the future
In the initial diagnosis, it became clear that the company could not simply downsize its way to profitability. To change its course, August supported the client’s management in defining a growth strategy as well as defining a plan for a complete turnaround program.
After the planning phase, the client management took the lead in leading the program and engaged August in a series of projects that focused on solving key bottlenecks such as organization structure, pricing and performance management. The client management also sped up change by engaging August to co-create a change campaign to drive day-to-day profit improvement actions in its outlet network.
Impact
One year after the cooperation was launched, the company was back on a profitable growth track, reaching above-market growth rates and a substantial margin improvement. In addition to the support in strategy, organization, pricing and performance management, the company valued August team’s contribution in making the turnaround happen by steering the pilot initiatives side-by-side with the management team.
Client CEO testimonial:
“In our cooperation, I have found August teams to be very diligent and productive. Most importantly I have learned to value having the same senior leadership that sell a project take an active role in the delivery with a resolute commitment to commonly set targets.”