Originally Posted by
tomato coupe
The $24M loss over 3 years comes straight from Campy. $100M per year sales is a well accepted conservative estimate from several sources.
And they're taking steps to address this. This is how business works -- if your cash forecasting indicates a future problem, you fix it now, before it becomes insurmountable.
Campagnolo is not a publicly traded U.S. company. There is nothing to suggest they have been forced to do this by any auditor. And, there is nothing to suggest that they have "burned through an emergency round of financing." Even if they did, the $10M loan they obtained is peanuts for a company with $100M annual sales.
Nothing to "suggest"...other than being forced to laying off 40% of your workforce. If that is not a "suggestion" I don't know what else could be.
Do you imagine they were a Soviet communist style gravy train where half the employees were sitting around reading the newspaper and collecting free communist salaries? Those 40% of people were all doing a function in their business, full time.
You do not cut 40% of your workforce in one night unless you are on the verge of going under. "Suggestion" he wants to see. LOL...
By the way 300 employees each making 50k salary per year is 15 million annually. Looks like they burnt through their emergency loan pretty quick. Yeah a 10 million per year net loss is no big deal he says... it's only the salary of two thirds of your entire company. Sure... no big deal. You will just pay those salaries from magic next year.
if your cash forecasting indicates a future problem, you fix it now
Laying off 40% of your workforce in one night is not a sign of forecasting. It is a sign of lack of forecasting and then getting punched in the face by reality catching up to your poor management. If they had actually forecasted properly, they would have reduced their workforce over time in a controlled way that does not decimate their business operations in one night. Did the bike industry headwinds just begin yesterday?