Transitions
From volume to value
Client profile
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Midsize metals producer
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Exports 80%
Challenges
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Adverse market conditions
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Falling profitability
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One export off-taker
Solutions
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Diversify international sales
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Add customer value
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Leverage financial markets
Actions
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Defined project goals, milestones, deliverables
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Researched international market for most profitable segments
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Set up a legal structure for global operations (sales, finance, logistics, customer service)
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Enhanced corporate marketing to customers, lenders, and other stakeholders
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Designed and implemented group accounting, reporting, controlling, transfer pricing policies and systems
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Qualified as Approved Supplier to selected EU and US customers
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Arranged credit facilities and reverse factoring with international banks
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Organized permanent stocks and JIT deliveries in target markets
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Secured international cargo and credit insurance policies
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Started direct sales to end-users worldwide
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Opened trading accounts with LME ring dealing members
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Developed a hedging program to reduce annual earnings volatility by 50-70%
Results
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Switched international sales from an exclusive offtake agreement to spot and long-term contracts with several end-users and traders
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Increased direct sales from 0% to 80% of all exports
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Grew annual profit by $3.5m despite customer acquisition incentives
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Insured open account terms for end-users
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Started replacing domestic financing with cheaper alternatives
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Advanced staff competencies through on-the-job training
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Transferred daily operations to employees