Strategy review and performance improvement for specialty retailer

Situation:

• Retail group had rapidly achieved global scale through aggressive M&A strategy and substantial marketing investments
• Covid-19 caught company on wrong foot: initial shortages in merchandise and logistics capacity were countered with substantial ordering and investments
• By the time market had normalized, company faced life threatening crisis
  • Overstock and rapidly vanishing liquidity
  • Over-dimensioned cost structures and substantial losses
  • High complexity
• Management commissioned a group wide strategy review comprising all business units, geographic footprint and role of holding to define path to profitability

Actions:

• Analyzed external and internal environments
  • Market trends, consumer behavior, competitive landscape
  • USP, assortment, pricing, operations, policies, cost structures
• Diagnosed cost-to-serve for segments and identified inefficiencies
• Developed a new go-to-market model based on segment needs and profitability
• Collaborated with BU management to develop and prioritize improvement ideas targeting:
  • Top-line growth
  • Margin optimization
  • Cost reduction
  • Liquidity and NWC improvement
• Defined phasing, costs, and IT requirements for measures
• Aligned group overhead, tech/IT, and projects to new BU strategies
• Reviewed holding company structure and costs for efficiency
• Defined 3-year transformation programs with roadmap and KPIs
• Developed integrated business cases for the group and each BU
• Established governance and transformation office to oversee execution

Results:

• Revised strategies endorsed by board and investors
• Strategic direction and priorities for each BU clarified
• Organization aligned around common vision and roadmap
  • Initiated improvement measures:
  • Resources for quick-wins mobilized
  • Cross-functional teams driving longer-term measures set-up
• Progress monitoring handed over to client
• Feasibility and impact demonstrated by early successes
• Positioned the client to adapt to the changing market environment and customer needs
• Established a culture of continuous improvement and value creation across the organization