Blueheath is on course to break even by the middle of this year, having made cost-savings of £3.1m and margin improvements worth more than £500,000.
The online delivered wholesaler had a troubled 2006, reporting full-year pre-tax losses of £4.9m in May, while its founder and chief executive Douglas Gurr left the company in June.
However, executive chairman Richard Rose, who took up his role in September last year, told The Grocer that a successful strategic company review, which put the spotlight on unprofitable accounts, delivery and buying models, as well as central costs, had turned the business around. "We have achieved all our objectives for the review and are now focused on growing profitable sales," he said.
"Break-even this year is taken as read."
The £3.1m cost savings had been achieved in a number of areas, including restructuring logistics operations, general administration savings and staff cuts, Rose said. It also renegotiated contract terms and shed a number of accounts it found to be unprofitable.
However, sales remained at a lower level than expected, admitted Rose.
The company has introduced a new pricing structure that rewards customer loyalty - with clients ranked as gold, silver and bronze. If a customer spends more, they get better prices. "We have a number of new customers coming through and spending more with us," Rose claimed.
Service levels at the company's depot in Thurrock, Essex, had also improved, reaching more than 97%, Rose said. Availability at the site had been hit after the company's Tamworth depot was closed and volume transferred to Thurrock and Wrexham.
The company also raised £3m of equity capital from its two largest shareholders Schroders and Smedvig Capital, which own almost half of Blueheath's share capital. The capital would shore up the balance sheet, said Rose.
The online delivered wholesaler had a troubled 2006, reporting full-year pre-tax losses of £4.9m in May, while its founder and chief executive Douglas Gurr left the company in June.
However, executive chairman Richard Rose, who took up his role in September last year, told The Grocer that a successful strategic company review, which put the spotlight on unprofitable accounts, delivery and buying models, as well as central costs, had turned the business around. "We have achieved all our objectives for the review and are now focused on growing profitable sales," he said.
"Break-even this year is taken as read."
The £3.1m cost savings had been achieved in a number of areas, including restructuring logistics operations, general administration savings and staff cuts, Rose said. It also renegotiated contract terms and shed a number of accounts it found to be unprofitable.
However, sales remained at a lower level than expected, admitted Rose.
The company has introduced a new pricing structure that rewards customer loyalty - with clients ranked as gold, silver and bronze. If a customer spends more, they get better prices. "We have a number of new customers coming through and spending more with us," Rose claimed.
Service levels at the company's depot in Thurrock, Essex, had also improved, reaching more than 97%, Rose said. Availability at the site had been hit after the company's Tamworth depot was closed and volume transferred to Thurrock and Wrexham.
The company also raised £3m of equity capital from its two largest shareholders Schroders and Smedvig Capital, which own almost half of Blueheath's share capital. The capital would shore up the balance sheet, said Rose.
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