Restaurant distributor COI files Ch. 11 - Nashville Business Journal:

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a Nashville-based foodservice distributor with nearlha half-billion dollars in revenue and customersz such as Shoney's, Ryan's, Applebee's and , has filede for Chapter 11 bankruptcy. Citinbg rising fuel prices and the loss of one of itsbiggestg customers, COI has debts in the $50 to $100 millioh range, including a $2.3 million debt to Ryder Transa Services in La Vergne. Over the last several the company, which has 700 employees and has distributiobn centersin Nashville, Tifton, Ga., and Ripley, W. Va., has startef to reduce the number of restaurantsd it serves tocut costs, according to the filing. Compant officials declined to comment on the CommissaryOperations Inc.
does business as and also manufactures food productds through a second Nashville divisioncalled Chairman's Choicse Foods. According to the bankruptcy filing, COI lost a customedr in March 2007 whose businese had generated 18 percent ofthe company'sz revenues. The company had revenues of $470 millionn in 2007, according to Business Journal research. In late 2007, COI obtainedf a large new account that more than replacex the volume oflost sales, the company had to invest substantial capitak in early 2008 to service the new according to the filing.
Also this year, the company lost severaol million dollars when its customer closed after filing Chapter 7 Bankruptcy Attorney Susan Limor says theres is a ripple effect in the bankruptcy courts when one companyg is dependenton another. "If one customer is a larges portion ofa company's business they become economicallu intertwined with them," Limor says. "The more diverse your custome pool is, the betterf off you are.
" Amy Vinson, a restaurant analyst with Avondales Partners, says food, freight and gas costs are up in the industryh and there is little profit Vinson says regionaldistributors don't have a large enougyh customer base to dilute the particular impactr any one customer can have. "That's wherwe they can get into trouble," Vinsojn says. COI say it was further hurt by risinggas prices. "Th e rise in fuel prices has been very detrimentalo tothe (COI's) profitability," accordint to the filing. The company is asking the court for controlk of its bank accounts to continuwebusiness operations.