Specialty Food Distributor

Company Overview

Specialty Food Distributor - National distributor of specialty products with annual revenue in excess of $700 million. Customers include most well-known retailers and a variety of independent stores. The Company had grown rapidly and expanded beyond its infrastructure capabilities, resulting in weak information systems and poor financial reporting.

Engagement Overview
•  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 & cash flow improvement actions, including:
•  Expanded the scope of management’s price increase strategy
•  Advised on route consolidation and frequency of deliveries based on an analysis of profitability by customer
•  Improved liquidity by extending  payables, reducing slow moving inventory and improving the timeliness of processing returned goods
•  Increased fill-rates, on-time deliveries and reduced out of stock inventory
•  Negotiated additional borrowing capacity with the Company’s lender in order to allow for the purchase of more discounted “buy-in” promotional inventory from vendors
•  Reduced the sales organization from 7 to 4 divisions and changed 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.

•  Served as interim CFO, and filled many other senior roles.

•  Interviewed and assisted in the hiring of a CEO, CFO, CIO and Executive Vice President of Sales.

•  Concurrent with the profit improvement process, Fort Dearborn conducted and expedited refinancing process including hosting visits with over a dozen potential lenders.
Results
•  Identified and implemented over $30 million in strategic and tactical initiatives to restore profitability.

•  Secured an $80 million line of credit and $27 million term debt facility under which most financial covenants were waived shortly after the refinancing was completed.

•  A senior officer of FDP is a member of the Company’s Advisory Board and assisted the Company in a significant acquisition.