X-PM turned around a family-owned Indian footwear company by focusing on the HR function.

Situation

A well known Indian footwear brand was facing a decline in sales after the division of the family business. The new generation who took over the business were inexperienced in steering the company and driving business growth. 

Solution

X-PM recommended and monitored the action plan:

  • Segregated channel partners into three groups on the basis of credit worthiness.
  • Drafted and transparently communicated fair business policies to reduce conflicts and improve trust.
  • Identified towns for increasing reach. Created a dedicated sales team to drive rapid expansion.
  • Revamped the product strategy by focusing on key categories (fast moving and premium) and launched new products.
  • Changed the credit policy to reduce credit days and limits, and also improve rotation.
  • Brought in a new Sales Head to support execution of strategy.
  • Outsourced selected process to vendors to enhance production without further capital investment.

X-PM’s solution was to parachute a senior interim HR Director into the organization to focus on the deliverables.

The interim HR director:

  • Conducted research, evaluated and negotiated with a few vendors that had strong end-to-end HRIS offerings and finalized the best one.
  • Streamlined the recruitment team by conducting several soft skills sessions for them.
  • Identified the need to outsource payroll processing since one person was earlier handling both this process as well as statutory requirements, compliance procedures, etc.
  • Conducted employee engagement activities and empowered team members with more responsibilities, thereby bringing about change.

Results

X-PM’s recommendations and actions turned around the company:

  • Half yearly revenues grew by 44% year on year.
  • Credit levels declined from 120 days to 65 days.
  • The number of active distributors increased 60%, expanding reach, lowering dependency on large volume players and saving cost.
  • Working capital and EBITDA margins improved from 20% to 30% due to top-line growth, without any increase in staff.
  • The company began to expand into a new footwear segments, to consolidate its top line and franchise with trade and consumers.

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