Garden Fresh Restaurants

The Situation

Garden Fresh is a California based and salad cafeteria chain that operated 130 restaurants at the time it filed bankruptcy in October 2017 after a failed sale process which resulted in the senior lender becoming the owner. This 40-year old chain was burdened with a crippling debt burden, a weak management team, substantial deferred maintenance, outdated IT infrastructure and several years of declining customer counts and sales caused by ineffective marketing initiatives and heavy reliance on discounting, an inefficient commissary operation and a demoralizing corporate culture, increased labor costs from increases in minimum wage, expensive work rule changes and a poor record of worker’s compensation claims; all of which resulted in declining EBITDA.

Role(s)

  • CRO
  • Interim CEO
  • Interim CFO

The Work

We conducted a comprehensive assessment and was then engaged to implement the turnaround plan. Our plan included the following: new marketing initiatives designed to move away from the ineffective campaigns of the past and toward campaigns designed to drive guest counts with lower discounting, closing unprofitable restaurants, renegotiating supply chain agreements, improving menu offerings, improving food and labor management systems, and making back-office functions more effective.

The Results

Sales and EBITDA were stabilized for the core 97-unit chain. Guest counts increased for seven consecutive months. The senior leadership team bought into a new vision of the business centered around creating cost savings that could be reinvested in all aspects of hospitality, including menu offerings, proper staffing and guest service and maintenance and refresh capital expenditures. We supported the sale of the company to a third party and renegotiation of the senior debt facility.


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Overview

  • Restaurant
  • Interim Management

Engagement Team