Client Success : Treasury & Cost Reduction From
India's Demonetization
The Challenge: India overnight withdrew 86% of Its Currency
Our client a growing manufacturing firm operated a largely cash business. Customers, vendors transacted largely in cash. Almost all employees were paid in cash. The November 2016 cash crunch threatened their suppliers, customers and potential loss of their skilled employees.
Rapid Solution
Customers & Vendors: We deployed to India and rapidly analyzed their business in a week. Our recommendations enabled credit to key customers or cashless solutions. Our client provided guarantees for crucial vendors to their banks.
Work Force: Based on our guidance and our hand in hand execution, the client purchased groceries in bulk for their employee to prevent hardship. The client issued bank drafts for urgent employee loans for weddings or medical emergencies, conducted training classes for their employees to use smart phones and e-wallets. They also financed low cost smart phones for some employees.
Process Flow Model: We also developed a process flow diagram with data for the past 3 years to ensure that the client could meet statutory and stakeholder requirements to keep its banking relationship and treasury management.
Result
The client expected the cash problems to last 4-6 months. Due to the rapid initiative the problems abated in just 7-8 weeks. We found opportunities in reducing inventory and identified unprofitable activities which they reduced. They have reduced costs 12% doubling gross margin and expect faster growth.