The Client
Lou’s Wholesale Distributors, Inc. (Lou’s Wholesale), a $45 million organization located in Philadelphia, is a distributor of tobacco products and other goods sold in retail stores located throughout southeastern Pennsylvania. Louis (Lou) Minore, President and majority shareholder of Lou’s Wholesale, formed the business with his father in the 1990s and has evolved the company into a market leader by providing same-day delivery, product line diversification, and strong customer relationships.
The Challenge
As a result of its thorough understanding of the tobacco industry and its strong distribution network, Lou’s Wholesale experienced an impressive period of growth a few years ago. However, this growth was not without its challenges. “Business volume escalated beyond our expectations in the early 2000’s and we began to encounter inquiries from the Internal Revenue Service on a more frequent basis,” explained Lou. “We outgrew our existing accountant and were in need of a solid business partner that could support us, guide us, challenge us, and advise us through our various issues with the government—in a language that we understood.”
The Solution
After Lou’s Wholesale engaged Kreischer Miller, we filed for authority to represent the company before the Internal Revenue Service. The initial stages of the relationship began with engaging conversations to gain an understanding of the facts and circumstances that surrounded the inquiries by the Internal Revenue Service. This was immediately followed by information gathering and active communication with the Internal Revenue Service that focused on establishing timelines, expectations, and outcomes that were acceptable to all parties involved. “Kreischer Miller controlled the process, which resulted in no additional cash outlays and favorable settlements that saved our company more than $150,000,” said Lou. “In fact, other opportunities were discovered during this process that we simply did not know were available to us.”
The Outcome
Since becoming a client, Lou’s Wholesale has expanded its relationship with Kreischer Miller by utilizing our attestation service, business advisory services, and proactive tax advice and planning strategies. We also provided a recommendation for a new accounting system that was implemented, assisted in the negotiation of a financing agreement to provide adequate working capital, and provide industry benchmarks and historical trends that are reviewed with management on a quarterly basis. Lou summed up the relationship by saying, “We have found a business advisor that really understands the distribution industry and challenges us in an appropriate manner. Kreischer Miller has earned our respect as a trusted advisor.”
If your company is in the distribution industry, consider allowing Kreischer Miller to be of vital assistance with our many Distribution Accounting services. We are here for you and can answer your questions and concerns. Please contact us to get the conversation started.