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Agriculture & Food

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MERU CASE STUDY

Implemented $37M of recurring cost savings for an integrated specialty food producer

COMPANY OVERVIEW

  • For nearly 75 years, Harry & David (“H&D”) was a leading multi-channel retailer and producer of branded premium gift-quality fruit and gourmet food products
  • Grow, manufacture, design and package pears, citrus, baked goods, chocolates and other confections
    • 1,900 acres of orchards
    • 54,000 sq ft bakery and confections kitchen
    • 920,000 sq ft of fruit packing and gift assembly facilities
  • An increase in low cost competition led to enhanced focus on quality, however customers became extremely price conscious following 2008 recession
  • Hired in late 2010 to provide financial advisory and interim management services
    • LTM EBITDA had dropped to negative $22 million

OUR APPROACH

  • A primary component of the 'back to basics' turnaround strategy was a comprehensive SKU rationalization to simplify product offerings, driving operational efficiencies, improved margins and a better overall customer experience
  • Improved sourcing practices and rationalized the vendor base, enhancing purchasing power, cost reductions and improved liquidity
  • Engaged in a full rebuild of the merchandising organization, realigning corporate sales group and bringing large portion of call center ops back in house
  • The team also worked to drive working capital efficiencies by focusing on inventory management and purchasing disciplines though enhanced S&OP processes

OUR IMPACT

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Implemented ~$37M of recurring cost savings in 11-months.

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Successfully completed pre-negotiated restructuring in under 6-months, saved nearly 7,000 jobs and prevented perhaps an irrecoverable impact to the community of Medford, Oregon.

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~70% reduction in overall number of SKUs.