Vantage Performance acted as the Chief Restructuring Officer (CRO) for this project.
National fitness retailer runs too hard.
A national fitness retailer with 25 stores turning over $30M had experienced years of rapid growth.
The group had also transformed from a largely franchisee model to a company owned model. However, the business had insufficient management skills and systems to run a chain of stores, nor did they have the required balance sheet and finance facilities to fund that transition.
As a result, the directors found themselves with mounting losses due to a range of underperforming stores and a working capital gap of $5M.
The business had also breached its $10M in banking facilities.
How we turned things around.
Our first step was to conduct a strategic review of the group to assess their options whilst implementing a business stabilisation plan. We developed a turnaround plan comprising a range of initiatives including a de-stocking plan, range review, site relocation, store closures, ATO/creditor payment plans, headcount and overhead reductions.
We negotiated a standstill agreement with the major financier and restructured expired term loans.
During the turnaround the business was sold to Rebel Sport.