European third-party logistics due diligence

Challenge

A global private equity firm retained New Harbor to assess the opportunities and challenges associated with acquisition of a Western European third-party logistics firm. The company’s focus on fashion and lifestyle items involved multi-channel distribution support for wholesale, store-based retail, and online fulfillment strategies. With the demise of garment-on-hanger products and rapid growth of e-commerce, the company’s future potential raised significant questions. Investors were particularly concerned about the provider’s positioning against massive new players like Amazon and versus large traditional logistics operators.

Approach

• Site visits: Toured facilities in the Netherlands and Belgium to evaluate changing customer demands, facility adequacy and flexibility, materials handling, information technology, process engineering and management capability
• Market and competitive research: Researched trends in the European and global fashion industry and evaluated competitive positioning and sustainability
• Financial analysis: Benchmarked services and profitability, and advised on financial model assumptions
• Growth strategy: Assessed management’s growth plans, and provided guidance for further acquisitions

Results

• Clear guidance provided on investor’s questions and concerns
• Realistic assessment of market prospects and risks informed investor’s bid
• Target company was successfully acquired