Restructuring |
3 Months Ended |
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Feb. 29, 2016 | |
| Restructuring and Related Activities [Abstract] | |
| RESTRUCTURING |
RESTRUCTURING
On January 20, 2014, the Company announced that its Board of Directors had approved management’s plan to restructure the Company’s operations, and enter into a key business partnership with The Emerson Group, a premier sales and marketing company located in Wayne, Pennsylvania. As part of this change, the Company outsourced to Emerson certain sales and administrative functions effective February 1, 2014. In addition, warehousing and shipping was outsourced to Ozburn-Hessey Logistics "OHL", one of the largest integrated global supply chain management companies in the United States. The Company’s inventory was moved to an OHL-managed facility in Indianapolis, Indiana and shipping commenced from there as of the week of February 3, 2014. A key benefit of the outsourcing move is that it shifted a substantial portion of the Company’s current fixed costs into a variable cost structure moving forward which can ultimately help keep expenses in better alignment with any future revenue generated by its brands. As a result of the outsourcing, the Company reduced its work force. The Company's workforce as of February 29, 2016 has been reduced to 15 employees. As of February 29, 2016, there were unpaid severance costs of $1,332,508 which is recorded as an accrued expense on the Company's consolidated balance sheet. As of November 30, 2015, accrued restructuring costs were $1,676,781.
The Company made payments of $344,273 for the three months ended February 29, 2016 related to the termination of employees during the quarter. The unpaid balance will be paid out during the balance of fiscal 2016 and the first quarter of fiscal 2017.
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