Citing unprecedented financial challenges resulting from the effects of the economic downturn across the nation and in Ohio, A. LoPresti & Sons Inc., a family-owned, wholesale foodservice distributor that has been serving northeastern Ohio for more than 100 years, announced that it is ceasing operations and will liquidate the business.
The company, which has annual revenues of approximately $40 million, had more than 1,200 customers - primarily restaurants, hotels, caterers, schools, hospitals, and business and industry accounts throughout the region.
"We have done everything we possibly could to survive these latest challenges, just as our family has done for four generations," Patricia LoPresti, president and chief executive officer, said in a press release. "Regrettably, we concluded today that we can no longer remain in business. With our lower volume and inability to collect some major receivables, we no longer have the cash necessary to keep operating."
A. LoPresti & Sons has 72 employees and operated out of a 180,000-square foot warehouse less than a mile from where founder Augustino LoPresti started selling fruits and vegetables from a red pushcart in 1908.
While produce has always been the company's specialty, its product line has expanded over the years to include dairy, groceries, frozen foods, fresh meat, poultry, and paper and cleaning supplies. Local farmers and other local suppliers have represented about one-fourth of the total product offering.
"Unfortunately, many of our customers and suppliers in the foodservice industry are under the same kind of severe economic pressures that we have been," Ms. LoPresti added in the press release. "Sales volumes are down, credit terms are being tightened, payments are falling farther behind and financing options have all but evaporated. We greatly appreciate the support and tremendous cooperation of all those who have worked diligently with us over the past few months to find innovative solutions to these new market realities - including our employees, union, vendors, landlord and lender. But in the end, these efforts were unsuccessful, and we have become another victim of the economic storm."
The press release said that the company's financial situation had become critical as of mid-September when the nationwide credit crunch became severe and demand plummeted. Although the company has maintained its market share since then, annualized business volume has decreased 25 percent from the previous year and two major customers have gone out of business, resulting in more than $500,000 in uncollectible receivables.
"Although we are deeply saddened by this development, we remain proud of the legacy of our family and our company, and we can rejoice in celebrating a century of outstanding service," Ms. LoPresti added in the press release. "Throughout our history, we have maintained the highest ethical standards and a deep commitment to the greater Cleveland community. We are thankful for the support of our customers and suppliers, and are grateful for the dedication of several generations of employees, who have been our extended family."
The LoPresti family will continue the August LoPresti Scholarship Fund, which supports students pursuing any aspect of the hospitality and foodservice fields. Founded 15 years ago in memory of its third-generation CEO, August LoPresti, the fund has provided more than $30,000 in scholarships to area students.