How Supply Chain Initiatives Create Value and Enhance ROI for PE Firms

Managing and operating partners are continually tasked with the job of improving EBITDA. An oft overlooked area usually ripe with optimization opportunity is the supply chain. Many times, it’s difficult to gain a clear big-picture supply chain view from one end to the other. The complexities can hide redundancies, outdated and inefficient practices and processes, and areas where technology could be implemented for overall benefit – including the bottom line.

Due Diligence: Identifying weaknesses
LynnCo uses IT-enabled transparency to seek out these inefficiencies that may be hard for private equity firms, manufacturers, and distributors to inherently notice or fully understand. It also helps draw a bigger picture, allowing you to see system flaws inside and outside a company. In fact, today’s supply chain management IT solutions deliver useable data, enabling agile and informed decision-making that can make the difference between being profitable and being defunct. Here are just a few of the benefits that can be realized from the application of LynnCo’s technology driven solutions:

  • Improved business-to-business (B2B) collaboration
  • Reduction of supply chain uncertainty
  • Prevention of lead-time fluctuations, disruptions, reduction, and prevention
  • End-to-end inventory visibility positioning — in motion, at rest, and at expected waypoints

Goals that Boost EBITDA
After you have identified your weaknesses, you should create actionable solutions to work towards keeping in mind five key improvement goals that boost EBITDA. Successfully addressing these can help streamline your system and reduce costs.

Consider these top five supply chain improvement goals:

  • Customer Service — Increase customer satisfaction while reducing inventory.
  • Supplier Accountability — Ensure supplier reliability and reduce risk.
  • Transportation — Reduce logistics costs and centralize a transportation solution.
  • Warehouse Overhead — Improve warehouse efficiency and reduce overhead.
  • Supply Chain Transparency — Deliver improved visibility across your divisions.

Value Creation: Improving ROI
What if your firm had a partner that could combine a consultative approach with the ability to operationalize tailor-designed solutions? LynnCo Supply Chain Solutions has proven success applying consulting, process engineering and operational rigor to portfolio companies whose supply chains are disrupted by the aftermath of an acquisition, reorganization or consolidation.
In order to rapidly ensure investors have in fact invested correctly, the experts of LynnCo’s Professional Service Group (PSG) provide an analytical assessment. In comparing metrics against the industry while remaining all-inclusive, a quantitative evaluation of performance is necessary. The three central stages of the investment assessment are: Analyze and Support, Implementation, and Accelerate Opportunities.



Analyze and Support: LynnCo’s PSG will perform an initial comprehensive supply chain health check and assess overall investment. This allows us to best understand the company’s priorities and develop a strategic roadmap, deliver a working capital performance review, and deliver a working capital performance review.

Implementation: The first 180 days will include implementing quick-hits of the supply chain health check, followed by training, mentoring, and developing existing new staff. As well as, facilitating change through skillful project management and establishing metrics, benchmarks, measurement systems, and KPI formulation.

Accelerate Opportunities: In this stage, we perform tactical execution of supply chain operational best practices, establish improvements to balance costs, and protect core revenue drivers. As well as, cultivate top-line growth and perpetuate bottom-line savings, initialize new growth ventures, and recapture lost opportunities.

Results
LynnCo’s PSG professionals examine a roadmap for establishing the efficient flow of products, people, and information in order to not only meet, but exceed the revenue requirements of private equity partners.

LynnCo Supply Chain Solutions is headquartered in Tulsa (www.lynnco-scs.com). For more information contact Lesli Dinsmore at lesli.dinsmore@lynnco-scs.com.

© 2017 Private Equity Professional | August 7, 2017

Print Friendly, PDF & Email

Related Articles

O2 Adds Associate O2 Investment Partners has hired Jimmy Frye as the firm’s newest Associate. Mr. Frye will be responsible for evaluating new transactions, due diligenc...
Littlejohn Bolsters Special Situations and PE Team... Littlejohn & Co. has strengthened its special situations and private equity investment teams with the hirings of Beth Pollack and Thomas Bennet, w...
Abacus Stays Busy with Westview Abacus Finance Group was the Administrative Agent and Lead Arranger for $25.5 million in senior secured credit facilities to support the recapitalizat...
Edison Closes Largest Fund Growth equity investor Edison Partners has closed its latest fund, Edison Partners IX LP, with $365 million of capital. The new fund was significantly...
LFM Quickly Raises Second Fund LFM Capital has closed its second fund, LFM Capital Partners II LP, with $184 million in capital commitments. The firm’s earlier fund closed in Octobe...
2018 Carried Interest and Compensation Survey This is the eleventh edition of the Carried Interest and Compensation Survey. This year we had 325 funds participate. The survey’s compensation data i...