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Restructuring
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3 Months Ended |
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Feb. 28, 2015
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| 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 has 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 will have reduced its work force from 97 to 21 employees when complete. As of February 28, 2015, the Company's workforce has been reduced to 30 employees. The Company has estimated that it will incur severance costs related to the reduction in work force of $2,773,594. As of February 28, 2015, $961,003 of severance costs have not been paid as of yet, which is recorded as an accrued expense on the Company's consolidated balance sheet. As of November 30, 2014, accrued restructuring costs were $1,043,897. During the quarter ended February 28, 2015, the Company incurred expense of $35,024, related to the termination of employees during the quarter and made payments of $117,918. This unpaid balance will be paid out during the balance of Fiscal 2015.
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