Efficient capital allocation is a key driver of superior financial performance, leading to higher EBITDA margins and increased market share. A well-structured CapEx portfolio, encompassing expansion, replacement, and strategic CapEx, is crucial for achieving strategic objectives, meeting financial and operational targets, and maintaining a competitive edge.

The development of an effective capital allocation and sourcing strategy requires a comprehensive view of short, medium, and long-term organizational needs. This involves determining the amount of capital required, identifying the areas of investment, understanding the reasons for investment, and outlining the method of capital deployment.

Best practices in areas such as operational footprint, supply and delivery network, make-or-buy decisions, and automation levels should be considered. These should be based on a holistic 360° total cost of ownership (TCO) assessment.

An optimal CapEx Strategy and Governance framework can yield above-average returns on capital, potentially boosting returns by 10-20%. This is a significant value proposition for decision-makers, emphasizing the importance of strategic capital allocation in driving organizational success. This is the value added of the EFESO team.

Venturing into new product segments, achieving net zero carbon footprint, and securing supply chains require significant capital investments (CapEx) in production equipment and facilities. These are crucial steps to bolster the competitiveness and future positioning of firms.

As the global economy braces for a substantial reset amidst rising financing costs, launching cost reduction projects (‘cost out’ projects) has emerged as a survival imperative.

Our comprehensive research across various sectors reveals untapped cost savings opportunities, with potential savings amounting to a staggering 30 to 50% of expenditure.

With a track record of successfully completing hundreds of investment cost optimization projects, we have identified a clear, effective formula for success.