A thirty-five-year veteran of the food industry, Inventure Foods chief financial officer Steve Weinberger says he’s still learning, and he encourages the same appetite for education in his staff. Here, he discusses his approach to the role of chief financial officer in a highly regulated, price-conscious, trend-churning world.
What do you consider your most important responsibility as chief financial officer?
There are two things—one is external and one is internal. As a public company we have to make sure of the integrity of our financial statements . . . so the investment community has real facts on which to base their investments. And internally I would say the most important function I have is to provide the tools, processes, information, and financial resources to ensure the organization can achieve its goals.
What is the financial mind-set? How does it differ from the perspectives brought by other members of the executive team?
We’re always pushing for fact-based decision making—typically in large organizations, lots of decisions are made based on art and science, and we’re pushing for more science. [We are] always pushing the organization to put together a set of facts on which to base our decisions. For example, if they want to invest in a promotion for product X, what’s the payout? What’s the timetable? What do we want to achieve? I just encourage the rest of the members to think in that fact-based, quantitative way.
How have you assembled a financial team to help carry out your mission?
We think of ourselves as a consulting firm, so our job is to consult with all of our various internal constituents to help them make better decisions. So I want a group of people who really want to get engaged in the business. Our ultimate goal is to ensure that no decisions are made in this company on anything without one of us in the room.
What do you look for in prospective team members?
I’m looking for team members who really want to engage that way with the rest of the organization. In order to do that, you really have to understand the business. You have to understand how sales works, how marketing works. You have to get out to the plants. You have to get out to our berry farms and understand the process of harvesting, growing, freezing berries, and so on. You have to go with our sales team to customer visits to get the customers’ point of view on what they’re looking for. So again, that’s how we ensure a well-rounded internal education to help with decision making.
How long did it take you to get that internal education?
Being a bean counter wasn’t a whole lot of fun for me, so I was really interested in working with the marketing team and sales team and operations to figure out how things work. It took me a while to understand, and guess what—I’m still learning. I’ve been
doing this for thirty-five years, and I’m still learning.
What major challenges do you and your team face? How are you planning to overcome them?
There are lots of challenges, certainly on the compliance side. There’s a lot of focus being put on public companies to provide more transparency in terms of our financial disclosure and all other financial reporting, including executive compensation. And also, I have to make sure that as we are growing, and that we have enough financial resources available through our various banking arrangements to execute all of our plans going forward.
And obviously in this environment, it’s harder and harder to increase prices. The economy hasn’t changed; we can’t raise the prices like we used to in order to cover all costs. For example, to the extent that our commodity input costs go up, and health care costs go up, we have to find very creative ways to meet our profit goals, understanding we may not be able to pass all of that through. We’re trying to figure out a way to deliver on internal and shareholder expectations while not raising prices to consumers, and that’s a bigger and bigger challenge as we’re moving forward.
What steps are you taking to address this economic challenge?
We have a very robust cost-improvement plan. We have a senior group of people that meets every Monday afternoon to figure out ways to eliminate costs from our company—sustainable cost improvements. And it’s hopefully not laying off employees. It’s doing things differently, finding more cost-efficient, better suppliers and making sure any new product launch we have is margin-accretive to the current portfolio. We set a specific cost-reduction target that’s robust enough that it will hopefully help us deal with the increased input costs to achieve greater efficiencies. Also we continue to invest in capital to improve margins—whether it’s freezing more berries or investing in high-speed packaging machines.
What industry trends affect your role as chief financial officer?
Part of my role as CFO is to strategically grow our business both organically and inorganically, and we’ve been very acquisitive in the last few years. We’re in the “better for you” food space, and that space is exploding in terms of mergers and acquisition activity and multiples, so we have to stay disciplined to make sure we can execute our M&A strategy without overpaying.
And in our industry you always have to delineate fads versus trends. You want to make sure you don’t buy into a fad, but rather buy into a longer-term trend. For example, Americans today are eating healthier, no question about it. Within that trend, there are different fads—you have to make sure any M&A strategy identifies opportunities that will have customer and consumer relevance and maintain growth long-term.
How are you hoping to continue developing your role as a chief financial officer?
I’m continuing to learn. I have a really good team of people that help me look after the day-to-day business, and that allows me the luxury to go to industry and investor conferences and explore M&A ideas. I’m also part of various CFO groups to understand what other companies are doing, what’s going on in other industries and in the CFO world externally. As I further build relationships and learn, I challenge myself to do a better job each day. In turn I challenge my team to ensure we continue to position our company as best we can for future growth.