Case Study
Rolling Out Zero-based Budgeting Approach at Nomad Foods Europe
Sep 25, 2022 06:21 AM
Introduction
Nomad Foods is Europe’s leading frozen food company and one of the largest in the world. Nomad Foods manufacture, sell and distribute a range of branded frozen food products across 13 European countries with the United Kingdom, Italy, Germany, Sweden and France representing their five largest markets. Their portfolio of leading niche brands, anchored by Birds Eye, Findus and Iglo, have been serving local European markets for generations and stand for food that is great tasting, high quality and convenient. Headquartered in the United Kingdom, Nomad Foods was formed in 2015 following the acquisition of Iglo Group. They are a NYSE listed company (“NOMD”) and developing a global portfolio of best-in-class food brands.
Problem statement
The SG&A profile of a newly merged entity was unacceptable in the view of the senior management team. The company had over €300m+ in non-people indirect costs across 7 countries (Marketing Units), 9 factories and Group Head Office functions. The visibility of spend and “one-version” of financials was diminished due to post-merger integration and accounting changes. Besides, the fragmented landscape for transactional systems (eg, legacy systems in core markets, different T&E systems in each market) was complicating the matters further. There was a multitude of stakeholders, who held qualitative and quantitative details/information behinds specific costs (e.g. supply chain costs, agency & contractors, Travel). Besides, there was limited visibility into functional costs of the newly acquired business.
Approch
Against the above challenges, Renaissance came in with expertise of working in similar, complicated environments and the expert knowledge of the requirements and the target solution. We immediately hit the ground running by driving the Discovery phase and providing revealing insights in a high-velocity environment. We have exhibited specialist financial cost modelling and advanced analytical skills, experience in FP&A and PB&F (i.e. financial planning, budgeting, forecasting and analysis), advanced understanding of financial concepts (Chart of Accounts (CoA), General Ledgers and P&L measures) and leveraged our exposure to Indirect Procurement and Spend Analytics. We also acted as a change agent and influenced decision making and dissemination of best practice across the business aiming to embed cost-conscious ways into the business culture.
Results
Renaissance involvement was crucial to take the ZBB Program off the ground and run it on schedule and on budget against the challenges of limited visibility of actuals, on-going post-merger integration efforts, complex technology landscape and changing priorities across the business functions. As a result of our efforts, attention to details and self-motivated enthusiasm, Nomad Foods has been able to hit crucial program milestones and is now on track to deliver multi-million euro savings across SG&A categories which significantly exceed the initial targets.
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