When it comes to British luxury brands, Sunseeker is up there with the best of them - incredible hand-built products renowned the world over for their quality and craftsmanship.
It hasn’t all been plain sailing for Dorset-based Sunseeker International. Factors including long periods of market decline meant the superyacht manufacturer was, like many of its peers, a challenged business. In 2014, significant under investment by previous owners and increasingly high costs saw the company return losses of £30m.
However, what the business did have was an incredibly strong brand, a dedicated and passionate workforce producing exceptional quality, and the support of a new, well-funded parent in China’s Dalian Wanda Group.
Wanda had a very clear vision for the brand, to turnaround the business as swiftly as possible. The appointment of both a new CEO (Phil Popham) and CFO (Hugues Jacquin) proved instrumental in realising that goal. It was the start of a restructure for the organisation and the creation of a new executive team that would lead the business back to profitability and, more importantly, towards long-term stability.
The tasks ahead were clear. The business needed fresh, brand-defining products with a much-reduced time-to-market, far better control of costs, improved production efficiencies, and stronger governance across key business processes.
While the heading was clear, the available ‘horsepower’ within the business to deliver at the pace required was lacking at that time. The decision was taken to bring a restructuring specialist on board – so PwC joined the crew.
Working closely with the new executive team across a whole range of critical restructuring projects, PwC has helped Sunseeker International post £6m (EBITDA) for the year ending December 2016, an improvement of £36m.
PwC supported the team across a number of projects, including:
- Assisting in preparing a three-year strategic plan for the business, instrumental to secure confidence and support from the shareholders and lenders
- Supporting companywide efficiency drives and cost reduction, introducing new disciplines including standardised bills of material, and delivering efficiencies throughout the end-to-end supply chain
- The secondment of Kim Stubbs (PwC) to Sunseeker International for 12 months as operations director, to lead all superyacht manufacturing operations, procurement and production engineering.
- Supporting facilities development and investment plans at key Sunseeker sites and adoption of new build methodologies and technologies
The emphasis has been on rapid change and fast results, while maintaining the quality for which the Sunseeker brand is renowned. This meant bringing in a range of skills and specialisms – from strategy to procurement and human resources, to cost reduction and working capital – to deliver a flexible, custom-built solution.
A crucial task set for PwC was to support the restructure and to improve the performance of the procurement function to support stronger control on material costs.
Alongside supporting the newly appointed director of supply chain, Tim Wright, with the renegotiation of major contracts and the introduction of spend category management disciplines, the team also got involved with separated strategic purchasing activities from transactional order placement and assisted in activities such as competitive benchmarking and tendering.
This has proved beneficial for both Sunseeker and its key suppliers. Suppliers now get full visibility of the company’s future production volumes to help plan their own capacities and supporting investments. It’s a move which has achieved important savings, quality improvements and better engaged and committed suppliers.
PwC also worked with the company on improving its manufacturing performance and logistics. Demand is strong for Sunseeker’s products and on-time boat delivery is a key part of ensuring customer satisfaction.
On-time delivery is also financially important to the business to ensure that cash inflows are timely and working capital requirements can be met. Operationally, this means making sure that all the parts that make up the boat build process are ready and in place line-side.
Another vital aspect is ensuring that all the skilled tradesmen, ranging from GRP laminators, carpenters, electricians and plumbers, are in situ and delivering the different work packages needed to fulfil the boat build sequence.
Customer demand is now very strong for Sunseeker boats, so it’s vital that the production line runs smoothly. The team is focused on keeping the supply chain in-tune with the build schedule and managing the labour force flexibly to achieve the planned boat build takt-times.
Sunseeker CEO, Phil Popham explained: “While we are not quite ready to sail off into the sunset just yet, the turnaround programme has been swift and provided the platform and investment to fund the launch of a range of exciting new products.
“New products stimulate growth in our market and our latest models are a great example of this. The new Manhattan 52 for instance has now become our fastest selling model ever and is now sold out well into 2018. We are confident we have strong product plans in place to continue this trend and we are certainly now moving into a period of sustainable growth.”