A client bought a business. A grocery store with a gas station, a garage and a restaurant in a small declining community.

The first two years went well until unforeseen circumstances (one week without hydro and isolated for one week) resulted in lost of goods and sales. Fresh and frozen products had to be disposed of. Sales dropped to zero. Cash flow was already at a barely acceptable low. The owners worked hard to recover for one year. As time went on the financial situation worsened. They applied for a loan but the banks refused.

The client called KR Consulting & Business Management Services in the hope to save his business.

• Survey of the buildings (accessibility, visibility, appearance)
• Condition of the inside of the operation
• Display of merchandise
• Customer survey
• Analysis of the accounting records

We discovered that the former owner still did the accounting for the business and the new owners never saw the financial statements on time in order to be well informed about the financial status of the business. As cash flow problems increased, purchasing was done impulsively. Goods were bought in very small quantities to have something on the shelf to keep the store stocked. The prices went up and the client could not compete. Customers turned to shop outside the community, as supplies from the store were unreliable and overpriced.

The customer survey indicated that the locals would buy from him if they could rely on the supplies i.e. gasoline as well as grocery products. We also discovered that certain management structures could be changed so the owner was fully in charge of what was occurring on a daily basis.

KR Consulting helped to put a business and action plan in place. This helped the client to get funding to increase his cash flow. Goods and services improved and he now could make a commitment to his customers to be reliable and affordable. Obsolete equipment could be replaced or repaired.

Finally, KR Consulting assisted in changing the management structures. This made the owner completely in charge of his accounting and daily control systems.

The business is doing well now. Lodging was added, which provides additional income to the owner.