The Client — Meridian Industrial Group is a mid-market conglomerate operating across five business units in the manufacturing and distribution sector. Following the acquisition of a regional distribution company, they inherited a logistics division that had been underperforming for three consecutive years.

The Situation — The acquired division had been loss-making at the operating level for 36 months — a fact that had been partially obscured in the pre-acquisition financials. Annual operating losses were running at $2.2M. The parent company's board gave a clear directive: fix it or exit it within two quarters.

The Challenge — The division had real assets — a loyal customer base, established supplier relationships, and a team with deep operational knowledge. But it had been run without financial discipline, with no clear P&L ownership at the business unit level and no visibility into which customer relationships were actually profitable.

The risk of a rushed exit was significant — it would destroy the customer relationships that represented genuine long-term value, and would signal weakness to the market at a critical moment for Meridian's acquisition strategy.

What We Did — We started with a full financial forensics exercise — rebuilding the P&L from the ground up by customer, by route, and by service line. Within 10 days, we had identified the $2.2M loss as concentrated in three underpriced customer contracts and two operational cost centers with no performance accountability.

We renegotiated two of the three contracts — retaining both customers while moving to profitable pricing structures. The third was exited cleanly. We restructured the operations team around clear P&L ownership, introduced weekly financial reporting at the unit level, and designed a 90-day performance improvement plan for each cost center.

Critically, we designed the restructure to retain the team. Every role change was made with transparency and a clear rationale. No one was made redundant.

The Results — The division reached operating break-even in week 11. By the end of the quarter, it was generating a $400K operating profit — a $2.6M swing. Team retention was 110% — the division actually grew headcount by one during the process. Meridian's board approved a further investment round into the division the following quarter.