Third-party logistics provider · Buyer · Operational diligence
The third-party logistics provider looked predictable until the customer agreements were read closely.
Published · Reviewed by The Diligence Standard Team · Updated
A buyer considering the third-party logistics provider believed the opportunity could justify the next commitment. The starting point was 18% adjusted EBITDA margin. Then one practical question changed the conversation: customer pricing had not kept pace with labor and occupancy costs.
What was at stake
The buyer was not trying to win an argument. The question was whether the price, financing and responsibilities after closing still made sense if labor, lease and customer terms changed the earnings case.
How the evidence changed the decision
The buyer needed the story and the records to agree. The review connected customer contracts and billing detail, labor roster and payroll and warehouse leases and utilization, then traced the exceptions back to the operating claim instead of relying on another summary or screenshot.
The important moment was not a dramatic accusation. It was the point at which the records supported “13.6% after continuity costs” more clearly than “18% adjusted EBITDA margin.” The buyer could finally see what had changed and why it mattered.
Decision
The buyer could now decide whether to reprice the opportunity, change the terms, require additional proof or step away. The issue had a defined place in the decision instead of remaining a vague concern.
Evidence reviewed
- Customer contracts and billing detail
- Labor roster and payroll
- Warehouse leases and utilization
- Carrier agreements and system access
Contract interpretation, employment matters and lease rights require specialist confirmation.