CASE STUDIES

Issue: Revenue growth without profitability.

Solution: Our experienced consultants reviewed the company’s gross margin returns by country and implemented performance based management reporting for the key value drivers of the business, across both international and domestic segments.

Outcome: Revenue increased by 100% over a three-year period, generating an annualised EBITDA Margin improvement of 15% year on year.

Issue: The business was not generating a profit.

Solution: Prickly Pear reviewed the overall business processes and expenditure by revenue category, then developed a revised Monthly Management Reporting Pack in order to measure the dollar spend for dollar revenue return.

Outcome: Reduction in annualised losses of approximately $3 million, which allowed the business to return to profitability within twelve months and alleviated the need for a further equity raise.

Issue: Business not generating sufficient returns to reinvest in its future expansion.

Solution: Prickly Pear reviewed the business revenue segments – being wholesale and retail – as well as segment profitability, to develop a category cost spend to segment return matrix.

Outcome: The business improved its segment returns within six months, returning to profitability and achieving targeted EBITDA/Sales of 15%. This allowed for successful implementation of expansion plans.

Issue: Rapid business expansion had resulted in a loss making performance.

Solution: Prickly Pear examined the business revenue by key customer and product lines and conducted a supply chain review, which allowed us to offer advice on the cost of manufacture and overhead structure throughout the business.

Outcome: The company implemented a revised pricing matrix of its product lines, thus allowing it to return to profitability and continue reinvesting in its expansion throughout international markets.

Issue: The loss of a key client resulted in a downturn of earnings.

Solution: Prickly Pear reviewed the quote to manufacturing processes between in sourced and out sourced providers, together with breaking down key business revenue streams and redesigning the chart of accounts for improved management reporting.

Outcome: The business increased its EBITDA margins by 10% within six months, allowing it to internalise outsourced functions, which further increased EBITDA margins by 2.5%.

Issue: Lack of clarity across gross margin and operational cost structure by product.

Solution: Prickly Pear reviewed the individual products offered and allocated appropriate cost of product, employee cost and operational overheads for each one. In addition to this, we created a Weekly Reporting Matrix to track the key performance indicators of the business.

Outcome: The business increased profitability with a 20% rise in EBITDA after three months, allowing the company to expand its operational footprint and generate additional earnings.