DTC brand: from QuickBooks chaos to a clean diligence call.
Two years of misclassified COGS, no inventory subledger, and a debt-financing window closing fast.
The situation
A multi-channel beauty brand was selling on Shopify and Amazon with strong top-line growth, but their books treated freight, returns, and platform fees as one bucket called "merchant fees." Gross margin was unreliable to the nearest ten percent.
What we did
We rebuilt the chart of accounts around contribution margin, ingested merchant settlements at the transaction level, and reconstructed COGS by SKU using landed-cost imports from the 3PL. A returns reserve and a sales-tax exposure schedule were added.
Outcome
Eight weeks after engagement, the brand had two restated fiscal years, a current month-on-time close, and a senior debt facility from a specialty lender that priced off the new financials.
Engagement profile
- Industry: DTC beauty / personal care
- Annual revenue: ~$8M
- Engagement type: Cleanup + ongoing Growth tier
- Time to first clean close: 8 weeks
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