Two framework contracts lost, taking 41 % of revenue

Within two quarters the wholesaler lost two framework contracts worth roughly EUR 39m in combined revenue — 41 % of the business. A manufacturing licence covering a further quarter of the range was up for renewal at the same time. The house bank had already extended the EUR 12m credit line once and made clear it would not do so again without a credible plan. The existing cash forecast ran eleven days ahead.

In the first three weeks we built a rolling 13-week cash forecast and maintained it weekly with the finance team. In parallel we broke the product range down by contribution margin: a third of the items contributed nothing while tying up significant inventory capital. Working with the instructed commercial law firm, we produced a restructuring plan that gave the bank a basis for a standstill agreement. We led the negotiations with the two remaining key accounts on shortened payment terms.

The business continued without formal proceedings. Annual fixed costs fell from EUR 21.4m to EUR 17.5m — a reduction of 18.2 %. Inventory capital was cut by EUR 4.1m. The EUR 12m credit line was extended by 24 months.