Plastic Food Service Disposables Manufacturer

Client Overview: Leading North American manufacturer of high quality, rigid plastic food service disposables serving the supermarket/deli, hotel/motel, and foodservice distribution markets focused on the $3.8 billion rigid plastics sector of the food service disposables’ market.

Opportunities/Challenges:

  • Highly dysfunctional operation created by the major relocation and merger of two operations
  • Ineffective key processes (i.e., scheduling, inventory management and operational reporting)
  • Extremely poor inventory accuracy and control
  • FY 04/05 EBITDA ($20M) on $30M Revenue
  • Prepare to stand-alone

Solutions:

  • Make immediate personnel changes that address key deficiencies and excesses
  • Instill sense of urgency and accountability; create a culture of execution and results
  • Identify and implement numerous operational enhancements to improve inventory accuracy, warehouse management, production planning and labor absorption
  • Ensure operational data accuracy for reporting and management

Results:

  • Formed a top-graded, enthusiastic leadership team
  • Improved inventory accuracy to +/- 90% levels
  • Realized initial cost savings of approx. $2M/yr; with additional $1M in annual savings starting in 2Q06
  • Established more flexibility for stakeholders regarding strategic options
  • FY 05/06 – Breakeven at EBITDA level; exit at over $200K monthly EBITDA
  • $3.5M EBITDA on $45M Revenue in FY 06/07

Need to grow, fix or exit your business?