Canadian Packaging Firm Enhances EBITDA Through Restructuring Initiative

A capital investment and advisory firm providing M&A, Strategic & Financial support to founders, families and management teams.

$1.9M
Annual EBITDA Increase
$1.3M
Reduction in OPEX

Challenge

A private equity firm engaged our team to deliver strategic and operational improvements for a portfolio company experiencing year-over-year EBITDA declines. With an exit planned within two years, the firm needed a rapid turnaround by identifying cost savings, operational optimizations, and revenue enhancements.

Approach

To address the inefficiencies, our consulting team employed a comprehensive and collaborative methodology that delivered tangible value:

    • Streamlining Operations: Conducted an in-depth review of distribution centers and identified a consolidation strategy to optimize the network.
    • Lowering Transportation Costs: Analyzed transportation expenses and uncovered significant opportunities for savings and process efficiencies.
    • Optimizing Pricing: Reviewed BOM pricing and discovered underpricing due to outdated cost inputs, leading to recommendations for a revised pricing strategy.
    • Reducing Excess Inventory: Assessed inventory levels and identified over $4.2M in dead stock that needed to be cleared to improve working capital.
    • Enhancing Labor Efficiency: Proposed a suite of technology enablers designed to reduce labor costs and improve operational productivity.
    • Refining Customer Strategy: Evaluated the customer base and pricing models to pinpoint improvements in profitability by adjusting pricing floors and rationalizing less profitable accounts.

Value Created

Through a targeted restructuring initiative, our strategic interventions streamlined operations, reduced costs, and optimized key financial levers, driving significant profitability gains:

  • Operational Cost Reductions: The engagement yielded $1.3M in OPEX reductions through DC consolidation, transportation cost efficiencies, and technology-driven labor optimization.
  • Enhanced EBITDA: Strategic adjustments in BOM pricing, inventory rationalization, and customer mix optimization contributed to $1.9M in EBITDA improvements, positioning the company for a successful turnaround.

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