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References > Projects

Focus – Restructuring and profit improvement

Over the last 20 years, the managing partners of MERITUS have taken responsibility in over 200 projects regarding corporate restructuring and profit improvement. Our goal has always been to enhance and improve our client’s companies with special emphasis on visible effects in profit and loss accounts and balance sheets. You can gain some insights by taking a short look at some of our exemplary project assignments below.

Project examples in restructuring

  • Pressing profit and liquidity crisis at an automotive supplier for electronic components (revenue >100 million €)
  • Provision of interim c-level manager
  • Definition and implementation of holistic restructuring concept
  • Price optimization/ readjustments in sales and purchasing department
  • Realignment of organizational and management structures
  • Negotiation of restructuring agreement and social plan
  • Optimization of working capital
  • Extensive stakeholder communication
  • Secured follow-up financing for the next 3 years
  • Realization of profit improvements of approximately 5 million €
  • Sourcing and induction of new C-level manager
  • Long-term profit and liquidity crisis at an automotive supplier for metal forming parts (revenue >40 million €)
  • Validation of a three-year business plan
  • Implementation of operational improvement measures
  • Definition of a financing proposal
  • Definition of the restructuring concept and report
  • Successfully secured follow-up financing with banks for the next 3 years
  • Prolonged profit and liquidity crisis at a metal processing company (revenue >20 million €)
  • Preparation of a restructuring report along with operational improvement measures
  • Setting up new corporate funding and ensuring regular bank communication
  • Introduction of an operational plant manager on interim basis at supplier’s site
  • Operational improvements on productivity in production and increase in sales prices
  • Return to profit zone through profit improvements amounting up to 1.8 million €
  • Follow-up financing of over 5 million € within 2 years – for expiring note loans and reimbursed bank liabilities
  • Profit and liquidity crisis with a low equity base at a gear manufacturing company (revenue >50 million €)
  • Preparation of a liquidity and profit improvement program within a two-week short audit
  • Elimination of liquidity gaps through rigorous inventory reductions amounting up to 0.75 million € within 3 months
  • Realization of profit improvements of over 2.3 million € mainly due to price increases, productivity improvements and purchase price reductions
  • successful break-even after 6 months
  • Acute liquidity gap and operating losses due to a market-caused drop in sales at an automotive supplying company (revenue >60 million €)
  • Preparation of a restructuring report along with operational improvement measures
  • Setting up restructuring bank loans
  • Introduction of an interim sales manager in order to generate new sales
  • Consistent operative implementation of cost reductions as well as accompanying bank communication
  • Significant participation in the acquisition of new orders
  • Reaching positive monthly results after 5 months of implementation
  • Another 4 months later, the approval of a growth loan through a bank was given
  • Significant losses and liquidity shortage at a jewelry designer and manufacturer (revenue >10 million €)
  • Preparation of a restructuring report along with an operational and financial restructuring plan
  • Setting up deferral of redemption payments from financing banks
  • Implementation of a security concept in order to reduce theft-induced loss of material
  • Operative improvement of order management and production
  • Coaching of senior management in leadership skills (e.g. key performance orientation, consistency in action)
  • Achieving positive returns within 6 months – followed by profitable growth
  • Unclear liquidity situation and unsecured financing for development service providers in the automotive supply industry (turnover >20 million €)
  • Creating transparency regarding the financial situation
  • Preparation of rolling 13-week liquidity planning
  • Derivation and implementation of short-term liquidity measures with a positive effect of >1.5 million €
  • Successful negotiations with banks on maintaining existing financing (“Stand Still”)
  • Secured long-term financing within 6 weeks
  • Tough earnings and financial situation for service providers in hydropower (turnover >20 million €)
  • Preparation of Independent Business Review (IBR)
  • Derivation of a concrete action program to restore profitability
  • Sparring for top management during implementation of the action programme
  • Confidence-building bank reporting to ensure covenants and implementation of measures
  • Implementation of liquidity-generating measures, in particular sale-and-lease-back with cash effects of >5 million €
  • Inclusion of KfW subsidies and loans in the context of the coronavirus crisis
  • Secured full financing within 6 weeks
  • Successful company sale to strategic investor after 6 months
  • Pressing earnings crisis and poor operating performance at the Eastern European plant of a Tier 1 automotive supplier (turnover >90 million €)
  • Creation of a personnel benchmark and detailed concept with an operational action programme
  • Adjustment of organisational and management structures
  • Implementation of personnel management measures
  • Short-term restoration of an adequate in-time delivery performance
  • Elimination of urgent quality problems in production
  • Introduction of key performance indicators, lean methods and shop floor management
  • Realization of profit improvements of  7.3 million € through savings in material costs, reorganisation of indirect areas, productivity improvements in production and avoidance of special cargoes
  • Break-Even of the production site within 6 month
  • Acute liquidity crisis and high losses at a producer of special railway vehicles (turnover >20 million €)
  • Preparation of a restructuring report according to IDW S6 including operational and financial measures
  • Mobilization of sales activities and introduction of sales management system
  • Implementation operational improvements in order management and production
  • Communication with banks and stakeholders to ensure dept capital provision
  • Secured corporte financing over a 3 year period
  • Implementation support and project management office for restructuring measures
  • Realization of profit improvements of 3.1 million € through reduction of material and personnel expenses

Project examples in profit improvement

  • Continuous earnings decline of over 80% in recent years due to passive sales work at a company in the mechanical engineering industry (Group sales >70 million €)
  • Analysis of the external market environment and the positioning of the company
  • Identification of growth potential by industry and technology
  • Assessment of the company’s USP from self-reflected and external view
  • Assessment of the current structures and processes in sales
  • Evaluation of the maturity level of the sales organization
  • Calculation of scenarios simulating the company development
  • Preparation of a recommendation on the strategic orientation of the company – Goal: Realization of identified growth potential of over 20 million €
  • Identification of short-term need for action and definition of optimization levers
  • Various uncoordinated purchasing units within the corporate group of a cable manufacturer (revenue >1 billion €) – grown through company acquisitions
  • Worldwide short audit (DE, PL, CN, CZ) in order to identify key levers of improvement
  • Implementation of purchase price reductions for pilot product groups
  • Concepting and launching of a worldwide purchasing organization including purchasing processes and guidelines
  • Implementation of a new category management system
  • Qualification of future lead buyers
  • Reduction of purchasing costs by 4.1 million € (6% of the considered pilot group of materials)
  • Definition of a roll-out implementation plan for the remaining product groups
  • Unsatisfactory profit situation over the course of several years at an automotive supplier (revenue >30 million €)
  • Preparation of a profit improvement program starting with a potential analysis
  • Identification of strategic growth areas and implementation of specific action programs
  • Restructuring of the entire organizational structure
  • Introduction of consistent working capital management (especially accounts receivables management)
  • Holistic purchasing optimization including supplier negotiations
  • Introduction and constant monitoring of key productivity figures (shop floor management)
  • Improvement of liquidity of over 1.6 million € within 4 months
  • Reduction of procurement costs by 5% and overhead costs by 15%
  • Achieving profit margins customary to the industry after 7 months
  • Diminishing corporate profits in recent year at a mechanical engineering company (revenue >100 million €)
  • Preparation of a profit improvement program starting with a potential analysis including competitor benchmarking
  • Reduction of procurement costs and quality costs
  • Productivity improvements through KPI-based management
  • Outsourcing of unprofitable areas
  • Boosting R&D output through KPI-based management
  • Improved profit situation by 2.3 million € within 8 months
  • Unsatisfactory profit situation at a steel producer (revenue >2 billion €) caused by decreasing demand and increasing price pressure
  • Setting up of a company-wide profit improvement program
  • Definition of company-wide improvement levers and area-specific cost-cutting targets (top down)
  • Validation of cost-cutting targets with the responsible division mangers (bottom up)
  • Definition of a roll-out plan for the implementation
  • Focused implementation support in specific areas
  • Realization of profit improvements of over 120 million €
  • Unsatisfactory profit situation at a mechanical engineering company (revenue >70 million €)
  • Preparation of a profit improvement program starting with a potential analysis
  • Reduction of personnel expenses through reorganization and efficiency improvements
  • Reduction of other operating expenses
  • Setting up an integrated KPI-system with consistent monitoring
  • Strategical and operational realignment of sales department and service structures
  • Process improvements in procurement, order processing and production
  • Coaching and qualifying the management team
  • Realization of profit improvement effects of 1.3 million € / 2.5 million € in the current / following year
  • Declining profit situation of automotive supplier (revenue 700 million €)
  • Conception of performance-improvement-program by analyzing global plant- and location-structure
  • Conduction of various plant-analyses and final recommendation for location-structure
  • Top-down target-setting for each operating company
  • Realization of gross-margin-improvements by defining of norm-strategies per strategic direction (product-category)
  • In addition, realization of gross-margin-improvements by identification of loss-makers
  • Reduction of personnel costs by identification and alignment of personnel cost potentials (incl. benchmark-analysis)
  • Identification of potentials for other operating expenses and definition of concrete measures
  • Specification of CAPEX-budget and proposal for distribution on different plants
  • Realization of profit improvements of 27 million €
  • Declining profit situation of automotive supplier (revenue >200 million €)
  • Conception of performance-improvement-program as part of a two-staged concept (rough concept & detail concept)
  • Development of prioritized 8 modules and 20 measures with greatest P&L-impact (rough concept)
  • Ascertainment and milestone planning of identified main levers/ measures (detail concept)
  • Top-down target-setting and bottom-up verification of identified potentials
  • Alignment of indirect personnel structures and streamlining of organizational structure
  • Increasing of productivity in each division by production optimizations
  • Identification of potentials for other operating expenses and definition of concrete measures
  • Operationalization of corporate strategy by cascading of overall multi-annual goals to the department-level
  • Identification of profit improvement potential of 10 million €

Implementation of optimization measures is ongoing

  • High slump in order (80%) at a niche player in special metal processing of large castings (>100 million €) due to changed market conditions and increasing competition from Asia
  • Market analysis in order to evaluate the need for corporate repositioning
  • Identification of unique selling propositions and technical core competencies
  • Qualitative and quantitative assessment of new potential market and product segments
  • 5 year-business plan for market development and financing
  • Subsequently further management sparring during the transformation process
  • Various purchasing departments on corporate and group level at a manufacturer of hydraulic products and -systems (revenue 300 million €)
  • Short audit evaluating possible savings in material costs
  • Realization of group synergies strengthening central purchasing department
  • Improvement of process efficiencies through predefined purchasing precedures
  • Introduction of a standardized purchasing system (incl. tools and forms)
  • Realization of 2.6% savings potential through negotiations with 50 biggest suppliers
  • Qualification of strategic purchasing professionals throughout the project