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Case Study: Fast Food Restaurant FranchiseBusiness Strategy Development & Implementation, Operational Analysis & Forecasting, Financial RestructuringCompany: $150 million fast food restaurant franchise - low fat concept, 300+ storesSituation/ Tasks Performed: After a decade and a half of strong growth and a recent buy-out, the Company began experiencing steady decline in revenues, lower than forecasted profits and an overall shortfall in working capital. These conditions were largely due to a downturn in the "low fat" sector of the industry and to lack of capital for marketing and capital expenditures. When TRG was retained the Company was highly leveraged and unable to service its senior debt as scheduled. TRG was engaged by the Company to assist management in developing a profit enhancement strategy and to advise the Company in negotiating a restructuring of its bank debt. Results: With TRG's guidance and advice, the Company was ultimately successful in restructuring its senior debt to more favorable terms. However, pressure in this sector of the fast food market has continued to negatively impact the Company and it has been unable to service its restructured debt. TRG has recently assisted the Company in negotiating a forbearance agreement that provides the time for the orderly marketing and sale of all franchise territories and corporate assets. In addition, TRG valued the assets to be sold and developed the sales strategy. Nature of Assignment: Primary: Business Strategy Development & Implementation Secondary: Operational Analysis & Forecasting Tertiary: Financial Restructuring Industry: Food Service; Retail |
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© Copyright 2007 The Recovery Group, Inc. All rights reserved |
