Chief Financial Officer / India
Three commitments reconsidered before their costs disappeared
- Annual service revenue
- ₹286 Cr
- Year ended March 2026
- Food-storage hubs
- 8
- Western and southern India
- Owned refrigerated trucks
- 128
- Service capacity; separate from customer cargo value
Decisions & consequences
01Repricing a distribution service after waiting time changed the fleet requirement
A proposed food-distribution contract in 2023 carried expected annual revenue of ₹7.8 crore. The initial model assumed that each assigned truck could travel about 9,000 kilometres a month. During operational review, the loading and unloading pattern supported closer to 6,200 kilometres. Vehicles spent substantial time waiting within agreed customer windows. The service team estimated that seven additional trucks would be needed to provide the originally described availability, implying about ₹3.15 crore of further vehicle investment.
The commercial team wanted to retain the customer relationship and believed the queues would improve once volumes settled. Operations was concerned that the original fleet could not deliver the promise consistently. I asked for the observed service cycle to be recorded and for the model to show the difference between an expected improvement and an agreed change. We included refrigeration running costs during waiting periods and the practical limits on assigning the same vehicle to another trip.
The revised proposal combined narrower delivery windows with an annual price of ₹8.55 crore. It did not simply pass every estimated cost to the customer. We accepted some scheduling work ourselves, while the customer agreed to a more workable unloading arrangement. The chief executive and commercial lead made the relationship decision with the operating team; my role was to explain the financial alternatives and the cash commitment each required.
The customer accepted the revised arrangement after reducing part of the initial scope. The final service therefore differed from the original proposal in both price and obligation. We avoided buying the seven trucks for that unchanged promise, but I do not present ₹3.15 crore as an operating saving. The business gave up some expected volume, and the scheduling discipline required continued attention. I would involve dispatch in the pricing discussion earlier next time, before an attractive kilometre assumption becomes the apparent basis of a settled commercial offer.
Opening a storage hub at a smaller scale while retaining its higher unit cost
A 2024 proposal for a new food-storage hub provided 2,400 pallet positions at an estimated cost of ₹18.6 crore. Commercial forecasts included customers whose seasonal demand had been discussed but not committed. The operating team preferred one complete build because it simplified construction and offered a lower capital cost per pallet. The owners also wanted a visible step in the company's regional presence. The concern was whether that scale would be useful soon enough to support its funding and operating costs.
I worked with the commercial and operating teams to separate initial commitments from possible later demand. We reviewed the product requirements behind those commitments, rather than assume any empty position could serve any future customer. The alternative was an initial 1,200-pallet stage costing ₹10.8 crore, with ₹1.2 crore of additional works and provisions that would support a possible expansion. The first-stage cost per pallet was higher than the original full-build proposal.
The board approved the ₹12 crore initial commitment. Management accepted slower expansion and the inconvenience of potential later construction. The commercial team had less spare capacity to offer at short notice, and some prospective customers remained outside the opening plan. We retained those disadvantages in the decision paper instead of presenting the lower initial amount as an uncomplicated financial improvement. Engineering and operations remained responsible for the design and safe use of the facility.
The first stage opened with a more supportable demand base, while the second stage remained subject to a separate decision. The ₹6.6 crore difference from the original proposal was not a permanent saving; it described expenditure not yet approved, and a later expansion could cost more than the original estimate. I would make the evidence required for expansion more explicit at the first approval. That would help the board revisit the decision on customer and operating evidence rather than on the understandable desire to finish a facility originally imagined at twice the size.
Funding the business without counting an unresolved cargo recovery as cash
Several disputed deliveries in 2025 created a combined cargo-related exposure of ₹3.4 crore. The commercial discussion involved responsibility for product condition and the point at which custody and service obligations had been fulfilled. We submitted ₹1.2 crore to insurers for consideration under the relevant policies. The operating team had retained temperature and movement records, but the existence of records did not by itself settle responsibility or establish that the requested recovery would be paid.
The first liquidity forecast had assumed the insurance amount would arrive within the following quarter. I asked that assumption to be removed from the base funding plan until there was evidence supporting both an amount and timing. The quality and legal teams continued the claim work. Finance prepared an alternative funding view that kept payroll, energy and vehicle obligations separate from the hoped-for recovery. This was a cash-planning decision, not a declaration that the insurer would reject the claim.
The directors approved a temporary ₹90 lakh additional borrowing allowance, with any actual draw governed by the cash position. Commercial colleagues were concerned that this would make the disputed account look worse while negotiations were still active. I explained that supporting a recovery claim and relying on it to meet a payment date were different decisions. We continued to pursue the customer and insurance matters without presenting the requested amount as a completed outcome.
Within the next six months, ₹55 lakh of insurance proceeds was received. The balance of the requested ₹1.2 crore remained under discussion, while the wider customer exposure required its own resolution. I retained those open amounts in the board update. The temporary funding arrangement carried a cost, but it kept the company from making routine obligations depend on the most favourable claim timetable. Next time I would ask for the liquidity treatment to be agreed at the start of the incident review, rather than correct an optimistic assumption after it has entered a forecast.