A lot depends, like you say, on how the market recovers, right? And we've seen that the recovery, yeah, the recovery has been quite slow. But I guess if you're optimistic or partially optimistic to the market, at least that could show a positive impact. And you mentioned as well that the U.K. is one of your main growth areas. And shop fitting in the U.K., we've seen, has been a little bit challenging in recent quarters. So what strategies do you have in place to mitigate a potential or the downturn that you have seen and potential further downturn?
Yeah, shop fitting has absolutely been challenging, I would say, during the last 12, 15, even 18 months. We have initiated, currently working on, but we have been doing three things. I think number one, we have made improvements in the quality of our project deliveries, i.e., we have gone through the value chain and we have been improving the processes in order to increase our efficiency, and number two, we have strengthened the sales team. Not completed yet, but absolutely strengthened the team during the last six to nine months, and number three, and finally, we are broadening the customer base. We have been living off a few, I would say, a handful of customers, and we have now made efforts to broaden this customer base to expand.
Okay, makes sense. And that was on the top line. So if we go down and look at the margins and talk a little bit about that as well, we also saw improvement in the EBITDA margin in Q3, where it jumped to 3.9% compared to 1.3% last year. So I guess my question is, what operational changes or cost management initiatives have you implemented to achieve this improvement, or what has actually driven this improvement?
Obviously, during the last 12 months, we have completed two restructuring rounds to reduce costs. We are not planning for more. That's one answer. I think secondly, we are always looking to carefully invest into our IT portfolio or to do discretionary CapEx to increase the efficiency. Sorry. Having said that, it's a mixed picture because while we have been reducing costs, we also have to increase our investments in the U.K. to support the growth potential. I think it's a combination of cost reductions, continuously looking to improve the efficiency, while on the other hand, also being able to increase the investments to support the growth in the areas where we really see that there is a big potential.
Great. And are there additional, do you guys have additional measures planned to further enhance profitability, or how do you see that development?
I think in itself, we have a scale now or a company now that is able to scale as soon as the market is picking up. Although it comes to a certain point where we have to, you have some certain costs, whether it's cloud costs, etc., that will follow the revenue growth. But we have been investing for some time now in the U.K. in particular. We have high ambitions for the U.K. So I think that in itself will drive profitability as soon as we're able to get back to certain levels where we have been before. Although it should be said that we also have to replace some of the previous revenues with large rollouts. We have to replace these with new revenue streams, whether it's order picking or other things that we have been talking about for a little while now.
Yeah, makes sense. Makes sense and these things, they take time, right? It's not something that happens overnight or even over a single month. It takes a little bit of time. Now, if we move over to one of the most interesting topics, which is your contract, your recent contract with Sainsbury's, so the rollout of the order picking solution with Sainsbury's has been a significant milestone for you guys, but could you provide a little bit of insight into the feedback you have received so far and what expected impact do you think this, you could say, partnership with Sainsbury's will have on StrongPoint's market position in the U.K.?
First of all, I'm super happy to say that everything is according to plan so far, and we've had a few meetings with, I should say, top management relating to this project during the summer, and the feedback from the customer was great, not only for the product or the solution itself, but also for the team implementing the solution. So that's definitely a thumbs up. I think as far as cross-selling, the potential for other products, one specific example is the Vensafe pilots that I just talked about in the presentation. It's a great example where we are able to have new discussions with lines of the business that necessarily haven't been too easy previously, so this is absolutely a door opener for us, and we're now seeing a specific result with these Vensafe pilots.
Makes sense, and do you have a specific timeline of when you could expect to see major results from these projects?
A pilot, difficult to have a rule of thumb, a pilot takes anywhere between 12 to 24 months, usually, until the customer decides to hit the button and place a purchase order, so that should leave us some time still to see the revenue hitting our books. We have several pilots, but I guess our ambition is to roll this out sometime towards the end of next year, but again, the point that I made initially in your first question, coming back to project-oriented, difficult for us to push anything more on the timeline as such, but at least now we have the pilots out there, and it's been good so far.
Yeah, makes sense. That's great to hear. And this was one interesting contract or project, you could say, in the U.K. And if you move over to the other side, where you also have a very interesting contract, which is in Spain with Mercadona, which is, if I understood correctly, the largest retailer, actually one of the largest in Iberia. Could you take us through, I mean, you guys have the CashGuard Connect project with that company. But could you take us through how that project is developing and what are those anticipated timelines for pilot and full-scale deployment for Mercadona?
Yeah. Well, again, I'm happy to say that, first of all, the market fit of the product is still very valid. It's highly supported by the customer demand. So nothing has changed from that perspective. As far as progression, we are well aware that we have been spending two years at least now on this project. And it's a solution that it's not necessarily made totally out of scratch, but it will still take time. So what we have now are the pilots which are out there, and they have been improving the last, I would say, 12 months. And we are planning to make this product ready towards the end of 2025 and start the deliveries thereafter. So whether there will be any revenues in 2025, not possible right now to say.
If anything, it won't be super significant anyway because we're kind of running out of runway for 2025, but we are still on that plan that we have been communicating now for some time.
Okay, makes sense. And when you guys first published this project, you also mentioned that the CashGuard Connect solution is, at least in the beginning, strictly for Mercadona, but you guys own the IP. But at some point, you guys will be able to sell the solution to other retailers as well. Do you have a timeline on when we can expect that to happen? And what do you guys see as the potential of this solution, not only in the Iberia region, but maybe also in other regions potentially?
It's a very brilliant and fair question. And honestly speaking, it's a little bit difficult to answer for several reasons. Yes, of course, we will not spend as much time and resources into a solution which can only be used by one customer. So there's definitely an ambition. But that's pretty much all we can say right now. As far as timing, depending on how many unique needs the other potential customers may have, we shouldn't rule out the opportunity that they could be rolled out in parallel. But there is a big but, and that relates to the production capacity and the demand from that perspective. So still, it's absolutely something we are working on, but can't really say anything more specific on the other potentials.
Yeah, makes sense. But I mean, it's great to hear that the product could be also used for other retailers as well as not solely for one customer. And if we move on, you guys actually also announced a new customer in Q3, where you mentioned an order picking solution for Delivere asy in New Zealand. So this is obviously on the complete other side of the world. But how does this partnership fit into StrongPoint's broader strategy for international expansion?
So this was not in itself a big contract, but still important contract in the sense that it's a good example where we can, again, capitalize on the Sainsbury's contract and the quality of the product rather than a specifically intended marketing effort. So this was more of an inbound opportunity that came as part of the Sainsbury's contract. And yeah, absolutely a good fit into our partner strategy, where we can grow throughout the or beyond our nine core markets with these kind of regions, which, of course, are slightly exotic from our perspective. But a very good and, I would say, efficient rollout of this fairly small contract so far, at least.
Okay, that's great to hear. And you guys actually also announced a new contract roughly one or two weeks ago. Could you just touch a little bit upon that one just really quickly?
Absolutely. This was a contract in the Baltics for a rollout of approximately EUR 2 million relating to self-checkouts with an existing customer, where again, we are able to deliver our own self-checkouts to a customer which obviously is happy with our products and solutions. So repeat business is something you always appreciate. And this will be rolled out within the next 12 to 18 months.
100%. And once you get these repeat businesses, that also is kind of a stamp of approval from the company, right? They like your product now. You're getting more projects with them. So that's always good news. And I see we're running out of time here. So just the last question for me, if we just step a little bit back and look at the broader picture and what we can expect. We've looked now in the history and what's been happening in the previous quarters. But now, if we just do more forward-looking and think, well, what can we expect going forward? Could you just talk us through how you see the broader market development both in Q4, but also in 2025? And more specifically, we were talking about the challenging market. Do you guys actually see a recovery, or do you expect a recovery very soon?
I think the answer is yes, we are seeing signs of recovery, although it varies between the regions and the markets that we operate in. So for Sweden, for example, we have been seeing that the inflation and interest rates have been coming down. Again, this is leading to improved customer activities. In Norway, on the other hand, as we are seeing as Norwegian, we are somewhat lagging behind Sweden. And that also relates to the macroeconomic trends, which is consequently meaning that the customers are still being prudent in their purchases. So a little bit different picture in those two countries. For the U.K., again, we do talk a lot about the U.K., but the market potential is just so much bigger. We are absolutely seeing improvements as well as results of the actions that we have talked about. So we have a new team.
We have strengthened the team. This has now led to an attractive pipeline, and we have high expectations for the U.K. going into next year and the years after. So I think overall, cautiously optimistic still. Yes, we are seeing improvements, but it will still take a little bit of time.
Makes sense. Okay, thank you so much for your time, Marius. Great as always. Very insightful, and I thank you guys in the audience also for joining us today. We will have to wrap it now. We have a very strict schedule. So thank you guys so much. Have a nice day, and if there are any questions, please feel free to reach out. Thank you so much.
Thank you. Cheers.
Cheers.