RSM advises South Pacific Laundry on expansion into healthcare

11 March 2021 Consultancy.com.au 6 min. read

Ready to expand their client base and actively target a new market segment, South Pacific Laundry engaged RSM’s experienced business advisers to test assumptions, evaluate viability, and fortify their expansion strategy.

Established in 1990, South Pacific Laundry (SPL) is a leading Australian commercial laundry company with 9 plants and 13 distribution centres across the country, servicing more than 3,000 customers on a daily basis. Having built an enviable client base in hospitality and other sectors, SPL’s leadership team felt it was time to expand their market segments by increasing supply to the healthcare sector.

Although the potential for targeting new markets had been considered before Covid-19, the unfolding of the health crisis in 2020 propelled SPL to take immediate action. Andrew Robson, CEO for South Pacific Laundry, says “Our customer portfolio was weighted towards accommodation and hospitality, rather than healthcare, which we were seeking to increase. When Covid-19 hit, it helped confirm the value of this strategy – both in the short term, and to strengthen the business in the long term.”

RSM advises South Pacific Laundry on expansion into healthcare

Seeking input from experts

SPL leadership decided to engage an independent third party to assist with evaluating the potential of the healthcare segment, and SPL’s capability to effectively service customers in the sector. 

Having previously worked with RSM experts in an auditing capacity, Andrew was confident they could assist at a strategic level. “I had a strong previous relationship with RSM through auditing, and a high level of confidence in everybody I had met there. We first talked about what they could offer, and I found that their segment knowledge in healthcare was very strong. I also knew that RSM work closely with their clients and tend to become more business partners than external service providers, which is what we wanted.” 

The RSM team, led by Kirsty McGovern-Hooley (Business Advisory Manager) and Andy Graham (Advisory Partner) brought a mix of strong industry expertise and commercial experience while taking a collaborative approach to solving the problem and addressing the opportunity. 

“At the time, SPL’s team was in overdrive because of Covid-19 demands on the businesses,” says Andy. “Additionally, one of their competitors was temporarily disrupted and unable to deliver services due to Covid-19, so SPL services were in high demand.

“Learning and moving quickly is critical in a rapidly changing marketplace, but equally important is understanding both capacity and capability to capture and realise opportunities.”

Stress testing assumptions for reliable outcomes

As a Business Advisory project, RSM’s team worked closely with SPL’s people across various departments to:

  • understand the specific issues and challenges the business was facing, and importantly the desired outcomes
  • carefully review data inputs and stress test baseline assumptions
  • collaboratively work alongside sales and operations to cross-check understandings and what the data was saying
  • provide insight and perspective on what RSM was seeing in the market through industry expertise and segment analysis
  • provide solution options to potential problems at hand

The team then joined the dots between operations and sales, in order to identify the outcomes everyone felt were achievable and could be delivered given the capacity and capability of the business.

“Other advisory providers rarely spend time with clients to develop a deep understanding of their business, let alone bring them along on the analysis journey or build their capability to ensure proper understanding of the building blocks, complexities, and implications of an analysis,” says Kirsty. 

“They generally take it away and develop their own assumptions based on how they think the business should operate, so the analysis essentially becomes a ‘black box solution’. Anyone can come back with a black box solution, but our approach tailors the solution given the capacity and capability of the business so they are empowered to deliver and execute with confidence.” 

Andrew agrees and says close collaboration with SPL’s internal team was an important requirement for the project, and a reason for selecting RSM.

“RSM’s team seamlessly integrated into our business as if they were part of ours, which was exactly what we were looking for. They worked very operationally and knew the healthcare segment well. We were seeking to collect our disparate thoughts and bring them together to create a cohesive strategy, which is what they helped us do. They also did it in a methodical way, so we stayed focussed on strategic outcomes.” 

Andrew says the outcome is everything they were looking for, including:

  • qualifying the size of the opportunity and potential outcomes
  • setting realistic boundaries to realise objectives
  • testing aspects of strategy execution that hadn’t been well-considered before
  • ensuring operational and sales capability

A collaborative approach with tangible results

On completion of the 4-week project, Kirsty says she was really happy to deliver a tangible outcome where SPL leadership could present to their board and talk to the size of the opportunity and the strategy required to execute it.

“We stress tested and verified the assumptions so the client could confidently present the business case, and the board was satisfied with the results and recommendations. The project was hard number crunching work – from understanding their capability and latent capacity to developing an achievable sales strategy. We asked so many questions and dug really deep, but it was a very positive and collaborative experience resulting in a thorough solution-focused report grounded in reality.”

Of working with the consulting firm, Andrew says he is very pleased with the outcome, and SPL has begun taking steps to put the strategy into play.

“Since the project we’ve taken a number of precursor steps necessary to effectively execute the strategy,” says Andrew. “Our work with RSM has provided certainty on what we need to do, including investing in our operations and sales capability so we can move forward with going to market.”

“I would be very confident working with RSM again in the future. Their approach is certainly practical, and their knowledge base of industry segments is excellent. RSM departments are highly connected, so whether you’re working with them on strategy, auditing or tax, you’re able to leverage this experience to gain very knowledgeable solutions to complex business problems.”