case study
Building a viable business plan to turn around the financially distressed position of a Belgian SME
Marnik Willems
In an increasingly complex and data-driven world, steering a company toward long-term viability requires more than intuition: it demands a clear, objective understanding of business fundamentals. A Belgian SME, operating in a traditional sector and facing mounting financial distress, found itself at a crossroads. Years of below-bar financial performance, limited data visibility, and gut-based decision-making had led to a severe liquidity crisis and urgent questions about the future of the business.
To support the management team in reviving the company, we helped create transparency in its data, identify which activities were driving value, and which were not, and develop a financially sound and strategically focused transformation plan.
Challenge
The company was grappling with multiple interlinked challenges:
Persistent financial losses: after years of declining profitability, the company was operating in a structurally loss-making environment.
Limited data transparency: revenues and costs were not clearly allocated across business units, making it impossible for management to see which activities were truly profitable and which activities faced major issues. As a result, they lacked a clear understanding of the company’s overall performance and were unaware of just how critical the financial situation had become.
Liquidity constraints: high historical debt and a deteriorating cash position were limiting critical access to external financing and therefore threatening the day-to-day activities and the company’s survival as a whole.
Lack of a coherent plan: as there was no structured plan for the future, the company struggled to align its leadership around key priorities and was unable to present a convincing case to external stakeholders, such as investors and lenders
Time pressure: to secure the financing needed to continue operations, the company had to present a compelling turnaround plan in 4 weeks time, demonstrating operational profitability within 12 months and a path to sustainable EBITDA growth within three years.
These issues created an urgent need to clarify performance at the business unit level, stabilize the company’s financial position, and build a credible, actionable turnaround plan.
The plan reshapes the company’s activity portfolio while preserving its core capabilities and identity, ensuring continued relevance in the market.
Approach
To tackle these challenges, we worked closely with the management team in a hands-on and structured manner:
1. Creating data transparency to identify profitability per business unit
We conducted a detailed Activity-Based Costing (ABC) analysis to allocate revenues and costs to each business unit. This enabled us to surface gross and EBITDA margins by activity, revealing which business units contributed positively to financial health, and which were diluting performance.
2. Building a fact-based turnaround plan
With these insights, and in combination with deep management discussions on market trends, potential and viable business cases, we facilitated the development of a five-year business plan. This plan included a phased transition period and a clear roadmap for each business unit, balancing short-term viability with long-term strategic repositioning.
3. Revising cash planning and debt structure
We reworked the company’s cash flow planning to reflect the new operational reality and explored various options for restructuring both existing and anticipated debt. By stress-testing different scenarios, we worked out concrete renegotiation plans on existing debt and defined the timing and magnitude of additional cash injections required to sustain operations.
4. Supporting legal and strategic scenarios
In collaboration with legal advisors, we evaluated the implications of multiple restructuring paths, ranging from divestments and carve-outs to formal legal restructuring procedures and, if necessary, bankruptcy preparation. This enabled management to understand their full set of options and risks before taking action.
Impact
The outcome was a robust, investor-ready business plan, built on objective financial analysis and co-developed with the company’s leadership team. The plan reshapes the company’s activity portfolio while preserving its core capabilities and identity, ensuring continued relevance in the market: EBITDA is projected to improve by 6 percentage points in the first transition year, followed by an additional 7 percentage points in the second year. From the third year onwards, EBITDA is expected to stabilize at healthy and sustainable levels, reinforcing the company’s long-term financial resilience.
Thanks to this exercise, the company now has:
A clear view of performance by business unit
A credible plan aligned with stakeholder expectations
A solid foundation to engage with potential investors or lenders
By taking bold decisions and backing them with data, the company is on a renewed path to sustainable profitability and long-term viability.
Summary
A Belgian SME faced financial distress due to poor performance, limited cost visibility, and mounting liquidity issues.
To secure financing, it needed a credible turnaround plan within four weeks.
BrightWolves clarified unit profitability, reworked cash planning, explored debt restructuring, and co-developed a five-year recovery plan.
The result is a clear, investor-ready roadmap that puts the company back on track toward sustainable profitability.