Maximize EBITDA Impact
Client Challenge
Following acquisition, the new PE owner recognised the potential for value creation through procurement, targeting an immediate EBITDA improvement, more longer-term step-change cost reduction and a need to further develop procurement capability.
H&Z Approach
Post-transaction value creation was delivered in three stages; An immediate, post-transaction Rapid Re-negotiation Program with a focus on price and payment term improvements, delivering immediate cashflow and EBITDA improvement. In parallel, the development and implementation of a comprehensive Value Creation Plan, addressing all spend areas and leveraging strategic sourcing, process optimization and, in particular, product cost optimization through cost & value engineering. Transformation to a new Procurement Target Operating Model, to optimise how procurement engaged with all business functions.
Results
- Rapid Sourcing re-negotiations on payment term & prices with EBITDA and cash impact in Year 1
- A comprehensive Value Creation Plan to deliver > 100 m€
- 300+ “should cost” calculations conducted as basis for fact-based negotiations
- Full Value Potential Plan incl. Savings potentials in commodity groups, product cost optimization and implementation, leading to over > 100 m€ savings
- Cost Value Engineering and Tear Down Workshops for range of products
- New Target Operating Model, including organizational structure, and collaboration models with interface functions
