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W EST PITTSTON – When igourmet declared bankruptcy, Spencer Chesman was confident his company would come out of it.
The big question was how he would do it.
The online seller of gourmet food exited bankruptcy on Sept. 24, nearly a year after it sought to reorganize under Chapter 11.
“It was our intent in one way, shape or form to keep the company going forward,” Chesman said on Tuesday.
The company is among the less than 10 percent of the companies that emerge from bankruptcy intact. Liquidating the assets is the more common practice, Chesman said.
The West Pittston-based firm came up with a plan to pay its creditors – some in full, others partially – that was approved by a vote and eventually signed off on by a judge.
It never shut down during the process and was able to fill orders for cheese, sausages, sauces and oils last holiday season, historically its busiest time for sales.
Founded in 1997, igourmet is gearing up for another strong season, but taking a different approach this time.
“Well, I think we’ve taken a much sharper pencil to everything we do and every penny we spend,” said Chesman.
When the company was growing, its focus was on maintaining that growth, he explained.
Historically, the annual sales were approximately $10 million, but the figure has been scaled down by the recession. In the second half of this year, it anticipated revenues of $3.65 million, according to documents filed in U.S. Bankruptcy Court of the Middle District of Pennsylvania.
Growth is still important, but the company is taking a different approach.
“We succeeded in keeping our customer base intact. We kept our core team intact and now we’ve come up with a strategy,” said Chesman.
The company’s location within a two-hour drive from the major food importers to the United States is key.
In the past, igourmet ordered a case of goods from a supplier after researching the product. Under the new plan, the company still does the research, but asks the supplier to break open a case. It keeps inventory costs down and allows the company to have a wider selection on hand.
“We needed to figure out how to grow in this climate,” Chesman said.