Restructured £87k debt for a family-run bakery
The business was facing closure after a bad expansion. We negotiated with 4 major creditors to extend payment terms from 30 to 90 days, giving the bakery enough air to reach the Christmas season.
The Hearth & Grain had three weeks of cash left after an aggressive expansion into a second site in Headingley. We stepped in to stop the bleed and renegotiate terms with their most aggressive suppliers.
The challenge
The bakery had built up £87,430 in arrears across four main creditors, including their flour wholesaler and the landlord of the new site. Their monthly overhead had spiked by £4,200 due to the new lease, but foot traffic in the new location was 34% lower than projected. By June 2024, the owner was using personal credit cards to cover the Friday payroll for 9 staff members. Cash is oxygen, and they were suffocating under 30-day payment terms that they simply couldn't meet.
Our approach
Our team of three specialists spent four days on-site in Leeds. We audited every invoice from the previous six months to find where the money was leaking. We realized the second shop was a lost cause and advised closing it immediately to guard the gates of the original profitable bakery. I personally met with the representatives from the flour mill and the equipment leasing firm to present a realistic repayment schedule. We didn't promise miracles; we showed them a hard path to getting their money back in full over 12 months.
The solution
We moved the bakery from 30-day terms to 90-day rolling credit with their primary suppliers. This gave the business a 60-day 'breathing window' to build up a cash reserve for the busy Q4 period. We also negotiated a mutual lease break for the Headingley site, which saved £2,150 in monthly rent. By consolidating production back to the original kitchen, we cut utility costs by 19% and stabilized the weekly cash flow.
Results
The bakery avoided liquidation and is now trading profitably from its original location with a manageable debt schedule.
Timeline
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July 2024Full financial audit and closure of the underperforming Headingley shop.
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August 2024Face-to-face negotiations with the top 4 creditors in Leeds.
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September 2024Signed new 12-month repayment deeds and stabilized the main site's cash flow.
"I was honest with Tiger Faction: I thought we were done. They didn't sugarcoat how bad the Headingley site was. We had to hold the line at our original shop, and their negotiation with the mill literally kept our ovens on."