Facility rationalization
Closing, consolidating or reconfiguring sites to improve the operating footprint. Decisions depend on incremental economics, network needs, closure costs and future prospects.
Facility rationalization in practice
Hypothetical: a site reports negative four-wall earnings before interest, taxes, depreciation and amortization (EBITDA). Before closing it, assess avoidable cash costs, allocated overhead, lease and closure obligations, network benefits and realistic improvement options. The accounting subtotal alone does not establish that closure creates value.
Terms Related to Facility rationalization
Four-wall EBITDA · Divestiture · Restructuring charge · Fixed costs · Operations centralization · All of the glossary