Mark Two acquisition and over-investment behind losses
Ultra Finishing has reported it is now on the road to recovery, following losses of £11million due to an over-investment in distributor Mark Two.
It acquired Mark Two in 2013 after it lost of its largest customers Tesco, before the distributor entered administration, for its warehouse space and IT platform and invested to support its turnaround.
However Ultra Finishing reported Mark Two still “struggled to perform”.
Chief executive Dave Cullen who was drafted in to mastermind a U-turn in fortunes for Ultra Finishing at the end of 2014 said putting Mark Two into administration was the first step to get the business back on track.
He commented: “Ultra Finishing lost their way in 2014 and service levels feel as all focus went on to Mark Two, however fantastic progress has been made this year. Investment at the start of the year provided the foundations for the future and we have continued to hit our aggressive targets and consolidation plans.”
Ultra Finishing has since reviewed its stock management to improve availability, restructured its internal sales team to enhance response times and sold the Burnley premises, with staff relocation without job losses or redundancies.
Dave Cullen added: “Consolidation of the internal sales team over the coming months will provide a focused key account management team, a larger pool of staff on the inbound team to answer all calls and emails promptly, an outbound team to improve communication with all customers and a dedicated technical team to provide after-sales support.”
Cullen continued: “There is still a long way to go as we consolidate the business to lay foundations for 2016. Plans for the future also include further simplification of the business with a reduced product portfolio and clearer core service proposition. Ultra Finishing will focus on the supply of high value orders to those customers who order in bulk. In the main, small order values will be serviced via our distributor network that is tailored to specialise in excellent customer service via their own fleet of vans.
“The business will continue to develop to meet customer’s expectations and market demands in a way that is both sustainable and equitable. We are looking forward to the future but we are now geared up to have an extremely exciting 2016. We thank all our customers for their loyalty through this troubled period and we can now start to enjoy the fruits of this turnaround together.”