The global forest products industry is facing enormous challenges. The collapse of housing markets around the world has reduced demand for building materials by 50% or more from peak demand levels of just a few years ago - even as massive volumes of plantation softwoods and hardwoods in South America, Asia and Siberia have reached commercial maturity.
Demand for most grades of pulp and paper is off substantially as companies and consumers ride out the recession. Nearly all pulp and paper markets are plagued by structural over-capacity, and despite an extended wave of consolidation, suppliers have been unable to establish much pricing power. Customers in nearly all sectors are facing distress and bargaining harder than ever before. In the face of these challenges, the need for cost containment and cash management in the industry has never been greater.
At AlixPartners, we have a well-developed understanding of the dynamics and challenges of the industry, gained through direct experience working with some of the world’s largest forest products companies. We have deep expertise in a number of areas in the most important cost management drivers, including:
- SG&A and purchasing cost reduction
- Distribution, logistics and manufacturing footprint rationalization and optimization
- Supply chain management
- Working capital and cash flow management
- Post-merger integration
- Balance sheet restructuring
- Bankruptcy