Driving growth and efficiency: Baker Tilly's strategic solutions for a food manufacturing and distribution company

Client need

Our client, a food manufacturing and distribution company, prides itself on its deep-rooted local footprint, exceptional product expertise, longstanding regional relationships and exemplary reputation for quality. Despite its history of success, the company faced challenges with outdated technology, financial reporting inefficiencies and operational challenges in the aftermath of COVID-19. Leadership changes further complicated matters, particularly given an unfinished ERP system implementation and a lack of timely KPI reporting.

These issues contributed to a trend of mounting financial losses, resulting in the need for a new debt facility to access additional liquidity. The company sourced a lender who agreed to support them, contingent upon the remediation of certain operational and financial challenges as a condition to close.

To meet these requirements, the company required an experienced partner to assess, develop and implement remedial plans to help them achieve profitability, drive process improvements and develop reporting tools for better visibility into its performance.

Baker Tilly solutions

Baker Tilly’s CFO advisory team was engaged to provide interim accounting leadership and remediation services in connection with the financing. Our team worked closely with the company to execute an operational assessment of the finance function, develop an execution road map and provide innovative, data-driven solutions to improve the company's financial and operational performance. Deliverables included:

1. Interim controller support:

• Assumed a financial leadership role as interim controller to manage operations during the turnaround
• Established and delivered critical financial tools, including a 13-week cash flow forecast, 12-month budget and forecast and monthly reporting package
• Managed the banking relationship, provided monthly business updates to the bank and acted as a trusted advisor to the company

2. Finance transformation:

• Implemented various accounting controls and procedures while monitoring the month-end close process to significantly improve timelines
• Ensured the company received accurate and timely financial reports to support management decision-making
• Assessed and developed strategies for cost savings and reductions in fixed costs
• Recommended updated pricing models to reflect proper overhead allocation
• Introduced innovative data-driven approaches, including a Power BI analytics tool and sales KPI reports

Results

Baker Tilly developed strong relationships across the company to achieve its objectives while preserving and respecting the culture of the organization. This collaborative approach allowed Baker Tilly to integrate seamlessly into the company and drive necessary change while ensuring that employees felt supported throughout the process.

Baker Tilly’s impact included:

• The transition from negative to positive cash flow within five months
• Cumulative improvements that will allow the company to remain liquid and profitable
• A 40% reduction in time required for financial close and reporting
• Strategies to reduce cost by more than $1 million annually
• A significant price increase negotiated with the company’s largest customer resulting in 2% profit margin increase
• Development of KPI reports and Power BI dashboards to produce real-time insights and monitor bank reporting requirements
• Selection and onboarding of a new full-time controller into a clean accounting environment

Baker Tilly’s efforts have allowed the company access additional liquidity, while strengthening their business processes, reporting, and organizational structure to effectively manage the business into the future.