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Retrenchment and Cash Flow Management | Made.com Struggles with the Economic Downturn
It's terrible news for shareholders who look like they'll lose their investment, but the challenges faced by online furniture retailer Made.com provide a superb case study for business students.
You can read about the issues faced by Made.com here in The Guardian.
The sharp downturn in consumer confidence in the UK is hitting Made.com hard as households cut back on demand for high-ticket items such as sofas, beds, chairs and tables.
In short, this recently floated public company which has issued several profits warnings is:
- Making a third of its staff redundant
- Stopping recruitment of new staff
- Looking to refinance its debts
- Exploring whether to find a strategic investor or sell itself to another business
- Limiting purchases of inventory to conserve cash
- Outsourcing customer service
- Closing its operations in China
- Reducing warehouse capacity to lower fixed costs
Anything else management have missed out?