Tren Griffin+ Your Authors @trengriffin I work for Microsoft. Previously I was a partner at Eagle River, a private equity firm established by Craig McCaw. I am on the board of directors of Kymeta. Jan. 23, 2020 1 min read + Your Authors

A very tough business. "In November Moody’s estimated a lease-adjusted debt-to-EBITDA ratio of more than 15 times over the coming 12 months 'as top-line growth is expected to remain elusive due to the highly competitive pricing and business environment.'" 

This from an old pre bankruptcy s-1 gives a sense of what Fairway Market margins are:  Hard, hard, hard. Occupancy costs = wholesale transfer pricing.

"Fairway’s business has suffered to the point that it had less than $1 million in cash on hand when it filed for bankruptcy, court records show."  Cash is oxygen for any business.

Moody's: "You could see it when you looked at Fairway's liquidity. They just weren’t generating enough cash. No free cash flow, and lots of debt.” 

$6M lease payments on the flagship store? A stone cold killer. Wholesale Transfer Pricing.

You can follow @trengriffin.


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