QLD COACH COMPANY SUCCESS STORY
The company has been operating since 1993 and has peeked with a fleet of approximately 300 vehicles and employed over 250 staff in 2015.
With the added scale and complexity, the business acquired the Pronto ERP system at a cost of $200K, whilst only starting to reap the benefits of the Pronto investment from 2016 onwards following the engagement of 180 Partners in February 2016, when essential functionality and capabilities of the system was activated and utilised.
The company experienced accelerated growth between 2012 and 2014 with the LNG boom and Revenue topping at $46.7 million in 2014 and $44.7 million in 2015, before declining rapidly to $24.9M in 2016 and $25.2M in 2017.
A Net Operating Loss of $1.9M was reported for FY16. The services of 180P were contracted towards the end of FY16 and the company embarked on a rapid turnaround with break-even achieved in FY17 and $450K profits reported for first half of FY18. The following areas were amongst those focused on:
- A lack of management Information resulted in management having no visibility of performance. 180 Partners reconfigured system functionality and wrote a series of press button high impact management and KPI reports, that gave instant real time visibility.
- Costing Structure - A standard costing system was implemented where actual costs are carried by Fleet Operations and standard costs per asset class applied across business units, revealing true underlying business performance.
- Fixed Cost Base - Fleet requirements, based on availability and utilisation measures were determined, resulting in a fleet rationalisation and replacement program.
- Business Planning - A business planning and budgeting process was undertaken with business buy-in to agreed KPI’s and standards.
The above contributed to the turnaround and a more sustainable business as follows:
- The business is tracked for performance by business unit and segment, improving focus and remedial action.
- Standard Costing assists to have a fair costing regime across business units, ensuring the tracking of true performance and accurate quoting.
- The rationalisation of the fleet has contributed $1 million to the bottom line.
- Thorough business planning resulted in targets being set in line with business strategy and sustainable performance.
The business continues to be profitable with ongoing focus on lifting underperforming business areas and being able to instantly respond to business changes.