The Company is a national distributor of specialty food products
The Company had grown rapidly and expanded beyond its infrastructure capabilities, resulting in weak information systems and poor financial reporting.
FDP was engaged to assist management in developing a business plan to improve profitability and cash flow and to refinance the Company’s senior debt.
Working with management, FDP initiated several profit and cash flow improvement actions, including:
–Expanding the scope of management’s price increase strategy;
–Advising on route consolidation and frequency of deliveries, based on an analysis of profitability by customer;
–Improving liquidity by extending payables, reducing slow moving inventory and improving the timeliness of processing returned goods;
–Increasing fill-rates, on-time deliveries and reducing out of stock inventory;
–Negotiating additional borrowing capacity with the Company’s lender in order to allow for the purchase of more discounted “buy-in” promotional inventory from vendors; and
–Reducing the sales organization from 7 to 4 divisions and changing from full-time to part-time in-store customer service reps, resulting in reduced costs, better geographic coverage and improved customer attention.
Advised management on the selection of new IT systems.
Implemented procedures to improve the timeliness and accuracy of financial reporting.
Concurrent with the profit improvement process, Fort Dearborn conducted an expedited refinancing process, including hosting visits with over a dozen potential lenders.
Identified and implemented over $30 million in strategic and tactical initiatives to restore profitability.
Interviewed and assisted in the hiring of certain management positions
Secured an $80 million line of credit and $27 million term debt facility under which most financial covenants were waived, shortly after the refinancing completed.