Book Publisher and Distributor

Company Overview


Book Publisher and Distributor - 

Our client is a publisher of children's electronic books and cookbooks. The books are sold to major national retailers and national distributors domestically and internationally in over 30 countries. The Company has revenues of approximately $150 million and has license agreements with many of the top children's licensors.  The Company's sales are very seasonal and result in significant working capital investment in inventory and accounts receivable. 

The Company had incurred significant operating losses for several years and was in very tight liquidity during its seasonal peak sales period.


Engagement Overview

•  The Company's lender proposed a reduction in its line of credit facility due to poor financial performance.

•  FDP was retained to review the Company's financial forecast and assist management in preparing an operating plan.

•  FDP identified and implemented nearly $13 million in profit improvement initiatives to restore profitability:
•  Reduction-in-force to align their operating cost structure with reduced revenue levels;
•  Shut down of an unprofitable business segment;
•  Initiated a plan to reduce the volume of returns from customers;
•  Shutdown of a warehouse operation; and

•  Reduction in promotional, warehousing and other operating expenses.

•  Assisted management in realigning key management within the Sales department.  Identified candidate for VP of Sales.
•  Reduced inventory by selling through slow moving items.
•  Identified and solicited proposals for foreign accounts receivable financing.
Results

•  Identified and implemented approximately $13 million in strategic and tactical initiatives to restore profitability in fiscal year 2014.

•  Reduced inventory levels 15% by selling through slow moving inventory and reducing customer returns.

•  Negotiated a revised line of credit facility with the existing lender and obtained a new foreign receivable credit facility.

•  Restructured the management team leading to better decision making.

•  Changed the Company's return practices to reduce returns which lowered expenses and inventory.