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Operational Efficiency Initiatives

9 Months Ended

Oct. 01, 2016

Restructuring and Related Activities [Abstract]

Operational Efficiency Initiatives

Operational Efficiency Initiatives

For the nine months ended October 1, 2016, we announced operational efficiency initiatives which resulted in severance and employee benefits charges, as further discussed below, as well as inventory initiatives that were largely completed in the second quarter of fiscal 2016. The inventory initiatives were fully completed in the third quarter of fiscal 2016, with a net $0.7 million fiscal third quarter increase to earnings more fully described below.

During the second quarter of fiscal 2016, we announced the closure of four owned distribution centers, and a corresponding reduction in force of approximately 60 full-time employees. These closures and reductions in force were completed by the end of the third quarter of fiscal 2016. A $1.2 million severance and employee benefits charge was recorded in the second quarter of fiscal 2016 in “selling, general, and administrative” expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), with a corresponding liability recorded in the Condensed Consolidated Balance Sheet in “Other current liabilities” due to the initiative. In the third fiscal quarter and for the nine months ended October 1, 2016, $0.5 million of this obligation was paid. The remaining payments are expected to be paid in the fourth quarter of fiscal 2016.

Furthermore, as part of the operational efficiency initiative process, we also began a stock keeping unit (“SKU”) rationalization initiative in local markets during the second quarter of fiscal 2016, resulting in the identification of certain less productive SKUs which we decided to discontinue offering. The SKU rationalization initiative was completed by the end of the third quarter of fiscal 2016. The following table describes our total adjustments as a result of both the SKU rationalization initiative and facility closures on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the third quarter and nine months ended of fiscal 2016 (in millions):

	Three Months Ended   October 1, 2016				Nine Months Ended October 1, 2016
Cost of sales	$	(2.1	)		$	2.2
Selling, general, and administrative (1)	1.4				3.6
Total (increase) decrease to earnings	$	(0.7	)		$	5.8

⁽¹⁾ Includes payments for material handling and delivery.

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- References

No definition available.

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- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 5.P.4)
-URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 5.P.3)
-URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869

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