Background and challenge
An emerging flexible packaging company — formed through the consolidation of several mid-size businesses — needed to identify new markets and submarkets to target as part of its North American and European growth strategy. Given the increased size of operations, the company required a new game plan for success in order to gain significant share in core markets. With a high volume of merger and acquisition (M&A) activity in the sector, the client also considered potential acquisitions as part of a larger expansion blueprint.
The client enlisted L.E.K. Consulting to review and refine its current strategy and to develop a strategic road map for ongoing growth. The end goal of the engagement was to maximize shareholder value for the brand over the next one to three years in anticipation of a liquidity event.
Our engagement with the client was highly impactful; the company was eventually purchased by a private equity firm, which completed several acquisitions to further build capabilities in support of the growth strategy.
Approach and recommendations
We evaluated the attractiveness of each potential end market, submarket and packaging format, determining how each market could strategically fit with the company’s strengths. We subsequently developed go-to-market plans for nine sectors, including recommendations for how the client could best allocate internal time and resources — for example, where to invest, where to focus on share capture and which markets to defend.
The outcomes of the engagement were impressive:
- The client applied our plan for harnessing the combined strengths of each of the three companies to accelerate growth.
- They focused on the most attractive market and customer opportunities, ultimately gaining share in core flexible packaging end markets.
- The company was later purchased by a private equity firm, which completed several acquisitions to further build capabilities in support of the expansion plan — a strategy that had identified the most attractive submarkets and customers to pursue in order to drive margin-accretive organic and inorganic growth for the client’s existing business.