Klosterman Baking Company is a commercial bakery serving major clients like Chick-fil-A, McDonald’s, and Kroger. With five bakeries and six depots, the company is a household name for bread in the Midwest. However, as Klosterman transitioned from a family-owned business to private equity ownership in 2022, it marked a turning point in how they approached their internal operations.
This case study explores Klosterman’s journey towards financial automation and highlights insights from two key members: Jared Beitman, Accounting Manager, and Jane Guthrie, Director of Infrastructure and Technology.
Initially specializing in direct-store delivery of freshly baked products to customers across Ohio, Kentucky, and Indiana, Klosterman later expanded into nationwide frozen distribution.
As the company continued to grow, Klosterman was acquired by a private equity firm in 2022. “We evolved from family-owned methods to more standardized business practices” shared Jane. The new ownership prioritized investments in technology to drive efficiency, laying the foundation for Klosterman’s journey to modernizing their financial operations.
Prior to the acquisition, Klosterman was operating on an enterprise resource planning (ERP) system developed in COBOL (common business-oriented language) back in 1983. Their financial operations were fully paper-driven, with invoices, receipts, and checks being manually handled, stapled, and filed. By the end of the year, Klosterman would have 12 filing cabinets filled with paper records – just for that year – and retain seven years’ worth for auditing purposes. Responding to audit requests meant manually sifting through the archives to locate and retrieve the necessary documents, which is both time consuming and prone to error.
In addition, payment cycles were just as inefficient and error-prone. To ensure checks arrived within vendor terms, accounts payable (AP) staff had to manually calculate mailing times. “If we were paying on net 30 terms, we’d actually have to send payments at net 14 to make sure they weren’t late,” Jared explained. In most cases, late payments resulted in vendor emails warning of potential credit holds due to overdue balances, adding additional strain to the already cumbersome process.
Recognizing these inefficiencies, Klosterman’s private equity owners decided to implement Microsoft Dynamics 365 Business Central (Business Central for short) to modernize operations and position the company for future growth. “Business Central fits our company size and the transactions we process—it understands our business needs,” Jane explained. She also shares that the new system opened their eyes to gaps that were being taken care of at the corporate level, such as three-way matching, purchase order tracking, and invoice approval.
While the new system brought significant improvement from their outdated COBOL-based solution, Klosterman still had manual processes that needed to be streamlined.
The real transformation began when Klosterman adopted the KeyBank ERP plugin, powered by FISPAN.
“Before implementing the plugin, reviewing invoices would take all day Friday. Now, with the automation in place, we can complete the entire process in just an hour. The time savings and efficiency we’ve gained has made a significant difference to our workflow.” – Jared Beitman
By automating their AP processes, Klosterman eliminated the need for manual invoice and receipt matching. “If the invoice details align with the receipts, the system automatically posts the invoice,” Jane explained. “If there’s a discrepancy, it goes through an approval process before being posted to Business Central.” This automation not only saved valuable time but also eliminated the overwhelming stacks of paper they previously managed.
Klosterman’s payment processing has also become significantly faster and more secure since implementing the KeyBank ERP plugin, powered by FISPAN. With ACH payments now integrated into their ERP system, vendors receive payments the very next day, drastically reducing any delays. “Being able to send an ACH payment and know it’s settled the next day has moved us light years ahead,” Jared shared. “It keeps our operations moving smoothly.”
This shift to faster, more secure payments has also strengthened vendor relationships, especially with distributors who were previously frustrated by late checks. “Our vendors are no longer frustrated with us,” Jane noted. “When we switched to ACH, they were thrilled because payments are faster and more reliable.”
Beyond speed and security, the plugin’s reporting feature has also enhanced accountability and audit readiness, allowing Klosterman to track who approved each transaction and who posted it to the general ledger.
The combination of Business Central and the KeyBank ERP plugin has enabled Klosterman to achieve greater operational efficiency without the need to work as strenuously to maintain it. “Our customers and vendors think we have it all together, and now, with FISPAN and Business Central, we actually do. But the truth is, we used to have to work really, really hard just to keep things running smoothly,” Jared explained.
FISPAN and KeyBank have teamed up to provide embedded banking solutions for businesses looking to streamline their financial operations and improve efficiency. By integrating banking services directly into ERP and accounting systems, the KeyBank ERP plugin, powered by FISPAN, eliminates the need for manual processes and enhances financial workflows.
FISPAN is a leading fintech company that seamlessly integrates banks with their clients’ ERP and accounting systems. Founded in 2016, FISPAN provides ERP banking solutions that eliminate the complexities and frustrations of traditional banking services. By embedding banking services directly into ERP and accounting software, FISPAN streamlines financial workflows, reduces errors, and enhances efficiency for businesses.
Klosterman Baking Company
Food and Beverage Manufacturing
501-1,000
Jared Beitman & Jane Guthrie
