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How an $85M manufacturer finished a stalled acquisition by settling one question first, found four product lines selling below cost, and recovered about $800K a year. Through interim leadership, with the systems work last rather than first.
Nine months after the acquisition the two businesses were still on separate systems, with separate costing methods and separate price books. Consolidated revenue closed on time every month.
Margin by product line could not be produced at all. The integration had stalled in the place these things usually stall, which is the gap between what the deal assumed and what either business could measure. The loss-making lines kept shipping while the question went unanswered, and the acquisition case slipped further out of reach with them.
Interim leadership restarted the integration on a single question: what does each product line earn. One costing standard was set across both plants before any system work, so the answer would not move when the platforms merged.
Four lines turned out to be selling below cost, two of them at volume. Two were repriced and two were discontinued. The systems consolidation followed on a plan the finance team could verify line by line, which is why it held.
Client names are withheld under confidentiality.
Both plants believed their own costing was the correct one. Reaching a single standard meant walking each floor and rebuilding four cost elements from scratch. Neither plant method survived intact.
Margin by product line was produced for the first time since the deal closed. Two of the four lines below cost were lines the acquisition case had counted on.
Discontinuing at volume meant three customer conversations and standing down a shift. That decision took six weeks longer than the analysis behind it.
The platform work ran last, against a plan the finance team had already signed. The controller and both plant managers now produce margin by line every month, and neither plant runs its own costing any more.
The acquisition case was reforecast on measured numbers rather than deal assumptions before the engagement closed.
