Case Study #02

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Pre-Acquisition:

Revenues: GBP 60-80M; Growth rate: <5% p.a.; Profit margin: ~10%

Post-Acquisition:

Revenues (5 years): GBP 100-125M; Growth rate: ~10% p.a.; Profit margin: >25%

Business was a publicly listed leading designer and manufacturer of industrial mission critical coding and marking systems. It had been one of the top four or five players throughout its history, and had been missing growth expectations lately despite having some good technological capabilities and good channels. 

Implemented four major drivers of value:

1. Clear delineation of product portfolio:
   Focusing on further development of core technology and differentiating it, and using partners’ technologies in the core of newer lines of products using own controllers and user interfaces allowed clearer differentiation in the positioning of the products in the market.
2. Bifurcation of go-to-market:
   Doubling down on the direct sales in the UK and France, and cultivating some of the best distributors of the industry in the other markets, combined with clearer defined differentiated products allowed for return to growth within two years.
3. Consolidation and streamlining of operations:
   Leverage of company’s internal production capability of core technology in the fastest growing segment. Streamlining of manufacturing, SG&A and R&D in the UK and in China
4. Continuous improvement:
   Developing and implementing key lean tools allowed for significant productivity improvement in assembly and overall operations, greater flexibility to match production to demand as well as acceleration in development and launch of new products.

These initiatives helped grow the top-line by nearly 10% p.a. and the bottom line by over 30% p.a. in the first five years of operations.