Debt restructuring and liquidation of €2M in overstock.
The challenge
The chain had accumulated overstock worth over €2M across 3 seasons. Cash flow was compromised and supplier relationships had deteriorated. Debt with financial institutions exceeded €800K and operating margin was falling 4% year-over-year.
The strategy
- 1
Complete inventory audit by category, age, and actual turnover.
- 2
Design of a phased liquidation plan with 3 channels: own outlet, B2B marketplace, and liquidation agreements with specialized operators.
- 3
Negotiation with financial institutions to restructure debt over 36 months with a 6-month grace period.
- 4
Implementation of an Open-to-Buy purchasing model to prevent future accumulations.
The results
EBITDA increased by 14% in the first full fiscal year.
Immobilized stock reduced by 30% in 8 months.
Financial debt restructured with €95K savings in interest.
Inventory turnover ratio improved from 2.1 to 3.4 turns/year.