|
The Food Partners' (TFP) clients are frequently facing competing pressures to generate growth capital while simultaneously needing to reinvest in their businesses and to provide liquidity to shareholders. TFP provides factual information and insight to help its clients evaluate the potential risks, returns and timing of various strategic options. TFPs' understanding of its clients' markets combined with its knowledge about the capital markets and strategic investing enables TFP to help clients evaluate various options not in isolation but rather in concert with one another.
At TFP, the Strategic Review process integrates our clients' strategic planning process with analysis of various growth opportunities and their impact on capitalization and liquidity issues at both the unit/division and consolidated level. TFP develops effective analytical models based on our expertise and knowledge, which management and owners utilize to evaluate, manage and grow their business. These models and valuation tools help clients evaluate multiple strategic opportunities within the context of the business' long-term goals and objectives. Once completed, TFP provides and trains clients on the analytical models, which typically become integrated into a more formal semi-annual or annual strategic and financial planning process. In addition, TFP's Strategic Review process enables clients to develop a long-term relationship that includes access to the knowledge and objectivity of an investment bank that is an expert in their industry, while maximizing managements' focus and time spent on running their business.
Timing
The Food Partners' Strategic Reviews are treated as highly confidential projects, and take approximately 5 to 8 weeks for completion.
Fee Schedule
Strategic Review fees are based upon either an hourly or a flat rate.
|
Case Study
|
|
Background
Washington State's seven largest apple growers/packers, who collectively represent more than 35 percent market share, formed a collaborative marketing alliance in March 2001. The purpose of the effort was to help reverse the industry's declining fortunes by promoting the exchange of information and ideas. The marketing alliance also was created to help facilitate a cooperative approach in addressing the industry's biggest challenges, including: grocery retail and wholesale consolidation, increasing demand for contract pricing and direct relationships between growers and retailers, China's dominance in world markets, a highly fragmented grower/packer base within the United States, lenders pulling away from the industry due to suspect industry trends, growing investment needs, weaker growers/packers taking desperate actions that hurt that rest of the industry and an increasing number of industry bankruptcies.
TFP was engaged by the alliance in June 2001 to assist in building consensus among its founding members, help recruit the industry's small and medium-sized growers/packers to the alliance so that the alliance represented a controlling market share and to generally generate momentum for the concept of collaborative solutions to the industry's woes.
|
|
Results
After analyzing the apple industry, TFP presented its research and recommendations to an audience of nearly 175 apple growers/packers in late July 2001. TFP's proposal suggested a multi-tiered strategy that positioned the marketing alliance as the key driver in the realignment of the industry because it provides the following:
- An adequate return to top line to growers/packers to drive stabilization of the supply side
- Minimal capital and financial stress
- Stabilization of prices for business planning
- An organized supply source to drive volume and satisfy retailers' desire to negotiate with fewer sellers and get a larger source of supply
- Movement toward "contract pricing," which benefits retailers, growers and packers and can lock in reasonable margins for suppliers
- Further sharing of resources versus individuality of members
In addition, TFP described how alliances and/or joint ventures help promote mergers, acquisitions and divestitures as well as the key issues associated with each liquidity event and strategies for accessing growth capital. As a result of TFP's presentation, the alliance was able to enhance its recruitment efforts and achieve a controlling market share while building consensus around more creative solutions to the industry's woes.
|
|
|
