How much freight spend is typically recoverable in a PE-owned manufacturer?

Active freight management typically recovers 15 to 25% of total freight spend. For a portfolio company with $4 million in annual freight costs, that's $600,000 to $1 million per year. At a 7x exit multiple, that recovery translates to $4.2 to $7 million in added enterprise value.

Why don't mid-market companies manage freight costs on their own?

At the $50 to $200 million revenue band, freight rarely has a dedicated owner. The function gets distributed across operations coordinators, warehouse managers, and finance staff. The costs accumulate because no single person is accountable for the total number.

What does an unaudited freight invoice cost a portfolio company?

Industry estimates suggest billing errors, duplicate charges, and carrier overcharges appear on 4 to 8% of freight invoices. For a company with $3 to $5 million in annual freight spend, that means up to $400,000 in recoverable charges processes without review each year.

How quickly can freight improvements show up in EBITDA?

Some recoveries, particularly invoice audits and carrier rate renegotiations, can begin producing results within the first 90 days. Building a multi-year track record that is visible and credible to buyers takes longer, which is why addressing freight early in the hold period matters.

How do I know if a portfolio company has an unmanaged freight problem?

Benchmark freight spend as a percentage of revenue against industry comparables. A company running 8 to 10% with no dedicated freight management function, no evidence of carrier contract renegotiation, and no invoice audit process has the pattern.

PE-Owned Cellulose Insulation Manufacturer Recovers $9.4M in Freight Spend

Christopher Nadeau

Jan 9

2 min read

Updated: Aug 19

$6.1M of the recovery came from recoverable EBITDA that had gone unnoticed inside unaudited invoices and untracked freight spend.

The portfolio company recovered $9.4M in freight spend, including $6.1M in costs that had gone unnoticed until the spend was audited. The majority of the EBITDA contribution came from spending that had never appeared on the P&L as a separate line.

Worker in protective gear sprays cellulose foam insulation on wooden wall in a sunlit room under construction.

The Freight Operation Before Haversack’s Engagement

Freight was managed without reporting tools to benchmark FTL pricing against national averages. Carriers passed steep markups through, and the company absorbed them without seeing them.

FTL quotes were collected by phone and email. BOLs were processed manually. Shipments moved without real-time tracking, which left operations without visibility or control once freight was on the road.

The invoice queue ran without an audit step. Errors flowed through to accounting unnoticed. Pallet sizing was non-standardized, inflating dimensional cost on every outbound shipment. None of it appeared on the P&L as a separate line. It was absorbed into cost of goods.

Inside the Freight Value Creation Sequence

Early in the engagement, the company opened FTL sourcing to a competitive bid board, replacing quotes by phone and email with structured market pricing. A tailored LTL carrier network was built to deliver better rates. Haversack TMS went live, ending manual BOL processing and giving operations real-time visibility.

Business intelligence was activated across freight spend, surfacing invoice errors approved without audit and identifying inefficiencies the team had never been able to see.

The combined result was:

$9.4M in recoverable freight spend
$2.1M from FTL and LTL
$1.1M from invoice leakage
$6.1M from identifying inefficiencies in spending trends, unused rental equipment, and moves that were auto billed but never executed.

Where This Pattern Repeats Across PE Portfolios

At an 8x EBITDA multiple, $9.4M in recovered freight spend equals $75.2M in enterprise value. The pattern is consistent: any PE-owned manufacturer where freight runs without competitive bidding, without a TMS, and without invoice audit has a version of this problem. The numbers change. The structure does not. The question worth asking is which portfolio companies fit the pattern.

See how our engineered insource solution turns freight into recoverable EBITDA across PE portfolios.

The Haversack Blog

PE-Owned Cellulose Insulation Manufacturer Recovers $9.4M in Freight Spend

The Freight Operation Before Haversack’s Engagement

Inside the Freight Value Creation Sequence

Where This Pattern Repeats Across PE Portfolios

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