Automotive & Mobility

Assessing the Risk and Developing a Contingency Plan for a Retail Network


Many Chinese dealers of a German passenger-car manufacturer’s sales network facing financial difficulties up to bankruptcy due to the financial crisis and economic downturn in 2008


Need to understand the financial situation of the dealer network in China and to assess the potential impact on the business


Necessity to develop and apply a systematic approach that allows for swiftly collecting and analyzing all required data/information due to the sheer number of dealerships (ca. 1,000)

Problem-Solving Approach

Collecting the data and conducting a static risk analysis:

Running a dynamic risk analysis:

Developing a contingency plan:


Concept for assessing the financial risk developed and operationalized


Distribution of risks in the entire Chinese retail network ascertained—broken down into a portfolio analysis and the likely implications on the dealerships’ sales and revenue performance


Liquidity gaps and the financial resources determined that are required to safeguard the threatened dealers


First approaches and measures developed in order to mitigate the risk