Latest Case Studies

Helping an assembly-based manufacturing business return to profitability and growth

This family-owned business, with a 50-year legacy and a strong market presence, had been making a loss of between £100k – £200k per month for 18 months. With a revenue income of around £14m and 75 employees, the business still had growth ambitions and aspirations, but they were unsure how to return it to profit as well as how to plan for and drive growth.

The Challenge

The client was in the unique position of having an exceptionally strong order book. The biggest challenge was in production and productivity, and therefore in the delivery of sufficient product per month to enable them to invoice the revenue numbers required. In addition, the Gross Margin was under significant pressure and was a major contributor to the lack of financial performance.

The Solution

To get the project moving, Jon Corns from CMC worked closely with the senior management team to gain a deeper understanding of the business operations. This involved an audit of processes, procedures and staff to help identify where the issues were within the current setup. From here Jon was able to design a strategic planned approach to start tackling the problems in hand. The plan involved:

• Building a strong management team to improve the capabilities within the business, so recruitment was managed effectively, and coaching could be incorporated to enhance the skills of existing and new staff.
• Putting financial controls in place to allow for faster, more accurate reporting and cashflow forecasting.
• Improving stock control processes for better handling, identification and management of inventory. This resulted in a reduction of inventory (stock), releasing tied up working capital and work in progress (WIP).
• Recruiting a dedicated Supply Chain Manager to enhance supply chain management and improve supplier relationships. This enabled greater leveraging of volume and strategic purchasing, better lead times and guaranteed deliveries. Ensuring production lines continued to run.
• Tightening up the process of scheduling and production planning to make them more efficient. Vehicles were booked in to ‘build weeks’, so the production team leaders were then able to bring in vehicles / customer jobs at their discretion. Production planning started 2 months in advance with jobs being allocated into a daily plan allowing for full visibility of exactly what vehicle was being pulled into the production lines on what days. This also assisted with improving customer experience.
• Updating systems and processes to provide quality, accurate data that is easy to maintain, which in turn can then be used to help influence effective decision making.
• Transitioning productivity to the principles of flow manufacturing rather than batch production and the implementation of some LEAN principles, such as single piece flow, daily huddles focused on the key metrics, value stream mapping to improve areas.

The Outcome

Jon joined the business in April 2022 and helped them drive improvements through productivity. This had a significant impact on invoiced sales, which is evident in the graph below. Combined with improving gross profit and reduced cashflow pressures, the business went from a position of potentially ceasing to exist to consistent profit in 2023. They are now on a strong trajectory of growth.

Do you need help bringing your business back to profit and growth? Contact us today to arrange a FREE confidential meeting.