Fast-growing food and beverage businesses face no shortage of challenges. Dealing with fluctuating costs, evolving consumer preferences, and fulfilling the demand that comes with manufacturing great products can all easily overwhelm a business when it lacks robust financial planning.
This is the exact situation that one of our clients, a food and beverage business based in New Jersey, faced as their business grew rapidly throughout the pandemic.
Experiencing a surge in popularity, the company needed help to manage expanding operations. This, alongside the team’s inexperience with formal financial processes, left the business struggling to understand and plan for future capital needs.
G-Squared Partners was asked to step in as a strategic partner, offering the expertise needed to navigate the complexities of the F&B landscape and help the company build a sustainable financial future. Today, after two separate engagements with G-Squared Partners, the business has grown significantly.
Initial Engagement: Building the Financial Foundation
Upon the initial engagement in 2018, G-Squared Partners thoroughly assessed the company’s financial records. Here, the first signs of financial confusion started to show. While the company was thought to be worth millions of dollars, it didn’t have a budget.
This lack of proactive financial planning hindered the company’s ability to articulate financial needs to a regional bank that was ready to offer substantial financing contingent on a clear financial plan.
Our team, understanding the value of accurate financial data, worked diligently to organize and clean up the business’s financial statements. This process involved various tasks, from reconciling accounts and verifying transactions to ensuring compliance with accounting standards like GAAP. The result was a set of transparent and reliable financial statements that could serve as the foundation for future expansions and planning.
Budget Development and Securing Capital
Throughout this process, G-Squared Partners focused on three main financial areas:
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Revenue Projections: forecasting sales based on historical data, market trends, and growth initiatives.
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Expense Management Strategies: identifying cost-saving opportunities and allocating resources efficiently.
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Capital Investment Requirements: determining the funding needed for equipment upgrades, inventory expansion, and other growth initiatives.
The resulting budget was comprehensive, detailed, and tailored to the client’s unique financial needs and goals.
Armed with this newly developed and robust budget, the client was able to confidently re-approach the regional bank with clear projections around what the financing round would help them achieve. By presenting a compelling case for the company’s growth potential and financial needs, the business secured an agreement for the requested capital, which enabled it to embark on ambitious expansion plans.
From Outsourced CFO to an In-House Solution
More than 700,000 businesses closed during Q2 2020 — the initial peak of COVID-19. But while many businesses struggled, others boomed – including our client. After seeing their business double in 2020, the founders decided the time was right to hire a full-time CFO.
They turned to G-Squared Partners, then their outsourced CFO, for guidance in finding the right professional. After a comprehensive interview process, the company found a CFO who was a perfect fit to lead them through their new phase of growth.
Over several months in 2020, the team at G-Squared gradually transitioned out of the engagement, helping the new CFO build out their own accounting and finance infrastructure. For a while, it seemed like that was all – until the CFO picked up the phone and called G-Squared Partners again in 2023.
Phase 2: Re-Engagement and Expansion
A few years later, the New Jersey-based F&B company was now seeing a new resurgence in growth. They’d continued to rapidly expand: entering new markets, launching new products, and even acquiring smaller companies in their market. In fact, they’d quadrupled in size since their first engagement with G-Squared Partners had concluded.
The landscape they operated in had shifted considerably. Their operations had become more complex, with expanded product lines, increased distribution across multiple states, and a much larger workforce. The founders had largely stepped away from the business, and the CFO G-Squared Partners had helped to hire was now the business’s CEO.
While they had come a long way since the initial engagement, the team realized their existing financial tools and models needed to be revised to meet changing needs. They’d hired a Controller to replace the CFO, but their finance team lacked the bandwidth to develop a consolidated financial model that would give the business the financial clarity it needed to continue flourishing.
Our team understood that a one-size-fits-all financial strategy would not suffice. We embarked on creating a highly customizable financial modeling process that would reflect the complexities of the company’s operations and provide the granular details required for informed decision-making.
This dynamic model covered virtually every aspect of the F&B company’s financials. It could be updated in real-time, programmed with assumptions, and allow them to forecast financial performance for coming months, quarters, and even years. The model included elements such as:
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Product-Level Costing: G-Squared Partners helped the business analyze the cost of each product. This enabled the company to pinpoint the cost structure of each product, better understand margins, identify profitable and unprofitable items, and adjust prices accordingly.
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Sales Forecasting: The model incorporated detailed sales forecasts across multiple states, accounting for regulatory, pricing, and demand variations. This allowed the company to anticipate sales trends and optimize supply chain and cash flow.
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Departmental Expense Management: G-Squared Partners tracked and projected expenses for each department, providing a detailed view that highlighted areas of overspending while enabling effective resource allocation.
All of this information rolled up into detailed financial statements and cash flow models, making this tool an invaluable asset for the business to build an understanding of their long-term working capital needs.
Alongside this financial model, the G-Squared Partners team also recognized the need to enhance the company’s financial toolset. We worked closely with the company’s controller to modify a reporting tool, customizing it to the business's exact needs. The modifications to the controller led to streamlined workflows, automated data collection processes, and improved accuracy and timeliness for financial reporting.
Successful Growth with a Valued Partner
The partnership between G-Squared Partners and this New Jersey-based food and beverage company exemplifies the value of strategic financial guidance. By tackling the company’s unique challenges head-on at different stages of growth, G-Squared Partners provided the tools, insights, and expertise necessary for the business to handle complex financial hurdles with confidence.
Whether you operate in commercial real estate, tech, or F&B like our featured business here, G-Squared Partners is here to help. Our team of experienced professionals can handle everything from performing everyday accounting tasks to stepping in as a turnaround CFO during a crisis.
Contact G-Squared Partners today to schedule a consultation and learn how we can help your business thrive.
