Insights
How One Business Turned a Disaster into Successful Growth
By
How ProPortion Foods kept customers and grew their business after a catastrophic building fire.
Over 18 months ago, Los Angeles-based food services company ProPortion Foods suffered a catastrophic fire at one of their headquarters that burned the entire building down. Today, ProPortion still has relationships with all of their same customers, has actually grown their business, and has put into place plans to grow over the next several years.
“It was truly hell,” says Brian Levy, a partner at ProPortion Foods who is in charge of sales and marketing. “But I’m really happy with the result. Within about 18 months, we pretty much lost 70 percent of our business, and turned it around and built it back up to where we were before. Our sales dollars in 2019 will be as much or better than pre-fire numbers. It’s really nothing short of a miracle.”
Overcoming disaster through personalized service
Levy attributes their high level of customer service as the main reason why ProPortion was able to keep their business going, despite suffering such a major loss. Because of its nimble size, ProPortion is able to provide the personalized service of a smaller company but with the scalability of a larger one. Levy emphasizes that he and his business partners make it a point to personally meet with their clients instead of sending a sales representative. Even when they were dealing with the aftermath of the fire, Levy says he met with every single client and vendor to explain face-to-face what had happened and the company’s current status.
“It was just relying on the very simple task of taking care of your customers, taking care of your employees, and making sure that you’re putting high-quality product in the boxes,” he explains. “That’s really what it comes down to: working hard, working fast and making decisions.” He adds that, luckily, their clients and vendors were very understanding and supportive, and that none of their employees were hurt in the fire.
"That’s really what it comes down to: working hard, working fast and making decisions."
Recovering from the fire certainly was a daunting task. ProPortion had to rapidly shift production from their main Los Angeles facility to their brand-new one in Round Rock, Texas, which at the time had only been operating for one week. “We had over $2.5 million worth of equipment shipping [in] from different plants so that we could start running,” shares Levy. “The one in Round Rock was empty. We had 12 employees. That’s it. Within about four months, we hired about 300 people.”
To help with the recovery process, East West Bank provided ProPortion with a line of credit, a standby letter of credit to support future growth plans, and equipment financing so that the company could expand their production lines. Just by expanding their production lines, ProPortion increased their business by about 20 percent, says Mark Koshnick, senior vice president of commercial lending at East West Bank.
However, Koshnick emphasizes that it was ProPortion’s customer-centric approach and work ethic that allowed them to ride through such a disastrous event.
“Their customers and their vendors saw how they fought through that difficult time and the character that they bring to the table,” says Koshnick. “They could have easily walked away, and nobody would have blamed them. But it was character that mattered to them, and they didn’t want to leave their customers and their vendors high and dry.”
Developing lasting relationships with employees
Although they were already planning to relocate their headquarters to Round Rock, ProPortion had to speed up the process after the fire. Despite that, Levy and his partners made it a point to offer their employees the opportunity to keep working with them.
“The key to any business’s success is their employees, and creating that bond with your employees is really important.”
“We’re also proud because when we moved, we offered every employee that worked for us the ability to move with us,” shares Levy. “If every single employee wanted to go, we offered them a relocation package, financial aid, money to move. Even though minimum wage in Texas was less, if you moved you kept your same pay.”
Levy proudly points out that some of their employees have been working for ProPortion since it first started about 10 years ago, and that others have worked for them for over 30 years, following them from past businesses to ProPortion. “The most important lesson I have learned over the past eight years is that one needs to figure out how to develop a human strategy to develop loyal, trained and engaged employees,” he says. “The key to any business’s success is their employees, and creating that bond with your employees is really important.”
Plans for growth
With the financing in place, ProPortion is ready to take on new customers and more orders. While they currently don’t have plans to open any new facilities in the near future, Levy says they plan to grow by having more equipment, more processing lines and searching out more customers.
“Ideally, we’d like to grow with the customers that we have,” says Levy. “We’d like to build our retail business, but overall we’d like to see our business double in size, as far as sales are concerned.”
“I think diversification is huge,” adds Koshnick. “It allows them to continue having lines to continue to move, in between orders from other types of product. Some of their customers are continual orders throughout the year; some there is seasonality, depending upon what the product is and when they want it on the shelves.”
In fact, ProPortion has started branching out—this time, into feeding people’s furry companions. “We’re making human-grade pet food,” Levy shares. “People are nuts about their dogs, so we actually make a product that’s made under the same rules and regulations that all of our human food is made under—it just happens to be for pets.”
In fact, ProPortion’s pet food already has a fan. “My dog eats it—he loves it,” Levy says with a laugh. “He goes back and licks the bowl.”