Business
Private equity’s evolution: From money collectors to business builders,
New Mountain Capital CEO Steven Klinsky shows ways to beat inflation and stagflation.
NEW YORK — Investment funds are expanding. They are a part of the U.S. financial market. Private equity funds’ total investment funds typically invest in stocks that are not listed, amounting to $1.036 trillion by 2024. According to the American Investment Council, this is an increase of 50 per cent over the year prior.
Some believe that private equity funds can be the primary driver of U.S. economic growth through investments in startups and companies that are not well-known but have high potential.
How has the market changed, and what can they provide? Steven Klinsky, founder and chief executive officer of New Mountain Capital, said funds have changed from merely collecting money to managing and taking strategic decisions for businesses that invest.
Kinky, who has more than 40 years of industry experience, has also stated that this might not be the best time to sell investment companies with the current increase in inflation and the possibility of stagflation. Instead, private equity firms should be patient until the financial markets’ climate improves.
Edited excerpts of the interview are included.
Q: You’ve been in working in the field of private equity for quite a while. What is the way the industry has changed?
Private equity has developed over the last 40 years since its inception, and when correctly executed, it is now a type of business building rather than a method of financing. The highest interest rate ever recorded in American history was achieved just before I joined Goldman Sachs in 1981. The 1980s were when we saw decreasing interest rates, rising inflation, and a rising market for stocks. Thus, the initial concept that private equity would be primarily about borrowing. Over the years, however, the most reputable private equity firms have become highly efficient, extremely strategic in certain industries, and real business builders.
Q: When you were in a downturn in your economy and when the market was not performing, What was the most effective method to earn money?
A: Then again, in 1981, when the market was at its lowest, you could purchase things at a cheap cost. Many of the businesses were fashioned by conglomerates of corporations throughout the decade of the 1970s. They could be trading at times at a lower value than book value, and it was possible to earn profits with lots of leverage in the current inflationary context. The number of dollar gains was small compared to today’s standards because there was so little equity, but the multipliers could be quite high. For instance, it could be an acquisition of $80 million with $1 million in capital and $79m in debt. If the company’s value was increased by $100,000,000, you would have made 20 million from one million. This is 20 times your capital, and private equity started to draw enormous interest.
Q: What’s happening within the private equity sector?
Private equity invests millions of dollars and earns billions of dollars of profits. Private equity is more sophisticated and professional now than in the days with only a handful of people working in the early 1980s. It’s not the same as the old film “Wall Street” in which Michael Douglas talked at the beach using a gigantic phone. It could be private equity back during the 80s. It’s not what it is today. New Mountain employs about 200 employees at its headquarters and employs more than 66,000 people in our businesses in the field.
Furthermore, we can now step into the business and create a company. For instance, we own the company Avantor. It was worth around $290 million when we discovered it in 2010. It is the company. It is now worth $25-$30 billion in value and is part of the Fortune 500.
A: Many people are concerned about stagflation due to market conditions. What is the most effective strategy for managing this private equity portfolio?
A: The most effective way to manage the private equity fund is to consider every company as a distinct business similar to your family’s own business. Consider the ways you could change and develop your company. Therefore, no matter what’s going on in the world economy, if you have an individual business and can improve the business, you will be able to outperform purchasing an index of stock. We also attempt to select industries we call “defensive growth” sectors, like life sciences or the upgrading of power grids in the U.S. power grid, which can expand regardless of whether the conditions are favourable. Additionally, even if the rates increase, however, they remain low compared to the rates before the beginning of my career. Also, in the private capital market, in case it isn’t the best time to sell your company, it is generally best to wait to sell until market conditions improve.
Q: A few portfolio companies are looking for strategic buyers rather than the initial public offer to exit strategies. Are you in this scenario that is currently in place?
A: Yes. The window for public companies for a company in the U.S. is pretty much over. However, there are many opportunities for your company to be bought because, for instance, the big corporations might wish to grow their business or may want to expand into an additional market. As a seller, you could help the buyers reach the direction they’d like to go strategically. Although the buyers still have plenty of capital. They continue to borrow money with low-interest rates compared to other years of our history. Many buyers want top-quality and consistently growing businesses, both for institutions and strategic buyers, even when those who are seeking public IPO markets aren’t as plentiful.
Do you think the current market or economic climate makes it difficult for startups to make a smart sales plan?
A: I think that if you have a great technology that is working and is reliable, you have the opportunity to sell to a strategic investor. The problem for solely venture capital firms is that, a year ago, things were so good that they may have been able to get a price they are unable to reach now. They could be disappointed by the amount a real company would give them today because they had an abundance of optimism.
Q How do you interact daily with Japanese investors
A First Japanese investor came to our company in 2005. We have added more investors over the last 17 years, and now we currently have more than 20 Japanese investors. They’re a mix of major investors, including regional banks and insurance companies and endowments. One of the reasons they wanted to invest in our funds was to find out if potential opportunities were available to their customers from an M&A standpoint. We also take the mindset of prudent leverage and have tried to not overtake on debt for our clients. We want our businesses to expand. We think this method has been especially attractive to Japanese investors when managing the risk and protecting against the downside.
Question: Which other investment strategies would general investors like?
An A: The Social Dashboard is one of the dashboards. It provides details on every one of the portfolio businesses we manage. We show how we have created or added over 61,000 jobs across our businesses with no jobs lost. The report also reveals how we pay excellent salaries and how we have invested $8 billion in R&D software and capital expenditures. We’ve also never had an equity-related bankruptcy or failed to pay interest, and we’ve racked up over $74 billion in value growth. This dashboard was launched in 2008 after Lehman Brothers went bankrupt. There was such frustration across the U.S. over Wall Street businesses and private equity, which many believed had destroyed the world.
Q What is the most important aspect of acquiring good companies Japanese companies?
A: Identifying a reliable “defensive growth” sector is the initial crucial step. The second thing to consider is to run the business effectively by attracting the best individuals and also to increase the latest technology, sales and size to help grow the company in a manner that it’s not currently doing. It’s not about the item you purchased, however, but what you can do to improve it. Also, you should be careful not to pay too much. In reality, the final 4or 5 per cent of the purchase cost shouldn’t affect the value of the investment if you’ve got a plan that you think will significantly boost the company’s size.
Question: What did you find the most remarkable about Panasonic purchasing Blue Yonder last year?
When we first purchased the business, it was known as Red Prairie. It was a modest software company. It did not offer software as a service. It didn’t possess artificial intelligence. It was not a global company. Through the years we ran it, we were able to make a secure and peaceful company and bring value and technology to it. Panasonic has been our co-owner in Blue Yonder for the last few years. They held 20% of the company before buying the entire company. They served on the board and assisted in expanding Blue Yonder into Japan. We, along with Panasonic and the other owners, collaborated to improve the business.
Panasonic sought global leadership in supply chain technology which is a long-term market. Since they first purchased 20 per cent of the company and had been in the boardroom and had a deep understanding of the business from the inside. We believe they were smart in the manner they started their study and later purchased the business. We would like to see them do extremely successfully with it.
Shipping products to Amazon FBA warehouses is a major expense for third-party sellers. Whether you’re shipping a single box via SPD (Small Parcel Delivery) or pallet loads through LTL/FTL (Less Than Truckload/Full Truckload), shipping costs can eat up 15% to 40% of your total margin if not carefully optimized.
In 2025, with higher fuel surcharges, regional delivery bottlenecks, and Amazon’s stricter FBA receiving policies, cutting shipping costs is no longer optional—it’s a necessity for profitability.
Checklist for Cutting Amazon FBA Shipping Costs
| Action | Benefit |
| Use Partnered Carriers | Save 30–70% on SPD/LTL rates |
| Consolidate into LTL when possible | Reduce per-unit cost and handling fees |
| Ship from prep centers near FCs | Shorten the last-mile distance |
| Use standard box/pallet dimensions | Avoid oversized penalties |
| Automate with FBA software tools | Reduce labor cost, avoid prep errors |
1. Choose the Right Shipping Method: SPD vs. LTL/FTL
Many sellers default to SPD because it’s familiar and easier to set up. But as your shipment volume grows, this method quickly becomes inefficient. If you’re sending multiple boxes regularly, switching to LTL or FTL can significantly lower your per-unit cost.
LTL is ideal for 1–4 pallets, while FTL becomes more economical once you’re shipping 20+ pallets. The larger and more frequent your shipments, the more you save through freight consolidation and pallet optimization.
| Shipping Method | Best For | Typical Volume | Cost Efficiency |
| SPD (Small Parcel) | Low-volume shipments (<150 lbs per box) | Under 10 boxes | Low to Moderate |
| LTL (Less Than Truckload) | Medium-volume shipments | 1–4 pallets | High for consolidated loads |
| FTL (Full Truckload) | Large shipments to one FC | 20+ pallets | Very high if volume allows |
Always run a side-by-side cost analysis between Amazon’s partnered LTL and SPD options for the same shipment. Even at lower volumes, LTL can beat SPD in cost-per-unit when handled correctly.
2. Optimize Box and Pallet Dimensions
Smartly stacked boxes and pallets in Amazon warehouses highlight how optimizing dimensions helps maximize space utilization
Dimensional weight pricing has become the standard for carriers, meaning your shipping bill depends as much on volume as on actual weight. Oversized packaging, under-filled boxes, or poorly stacked pallets all translate into wasted money.
Even minor changes to your box dimensions can cut down on shipping charges significantly. It’s especially important to standardize carton sizes across SKUs and ensure you’re getting the most efficient stackability when using LTL or FTL.
| Packaging Type | Cost Impact | Optimization Tip |
| Oversized Boxes | Higher per-unit cost + surcharges | Split items into smaller boxes |
| Inconsistent Sizes | Inefficient pallet use | Use standard cartons |
| Poor Pallet Stacking | May result in Amazon rejections | Follow Amazon’s FBA pallet guidelines |
A Freightos shipping case study found that by trimming box height by just 2 inches across 300 monthly units, one seller saved $420 in dimensional weight charges over 30 days.
3. Consolidate Shipments Strategically
Frequent small shipments often result in higher per-unit shipping costs, more carrier pickups, and a higher likelihood of fulfillment center delays. Consolidating multiple small shipments into a single, well-organized load saves on handling and often qualifies for better freight rates.
More importantly, Amazon prefers well-labeled, bulk deliveries over fragmented ones, which can
delay check-ins during peak seasons.
| Scenario | Estimated Monthly Shipping Cost | With Consolidation |
| 4 SPD shipments × 10 boxes | $900 | $540 |
| 1 LTL pallet shipment (same qty) | — | $480 |
If you’re using a prep center or 3PL, schedule shipments biweekly or monthly instead of weekly. Many centers will hold goods for a few extra days to help you consolidate at no added cost.
4. Use a Prep Center Near Amazon FCs
A prep center near Amazon warehouses ensures faster and more accurate processing of shipments ready for dispatch
Shipping across the country adds avoidable costs, especially if your inventory is already located closer to Amazon’s main fulfillment hubs, according to Dollan Prep Center. Working with a prep center within a short distance of Amazon’s major FCs helps you reduce last-mile freight charges, shorten delivery windows, and reduce potential delays during appointment scheduling.
This also increases the chances of faster check-ins and fewer rescheduling penalties.
| Top FC Regions | Benefits of Nearby Prep Centers |
| Dallas/Fort Worth, TX | Central location, multiple nearby Amazon FCs |
| Hebron, KY | Common FBA inbound point for East Coast sellers |
| Moreno Valley, CA | Ideal for West Coast imports from Asia |
| Allentown, PA | High Amazon FC density, fast East Coast distribution |
Relocating your prep and storage from the West Coast to Kentucky or Ohio can reduce per-pallet shipping costs by 20–30%, especially for sellers distributing nationwide.
5. Leverage Amazon’s Partnered Carrier Program
Amazon offers discounted rates through its partnered carrier program, which includes both UPS for SPD shipments and several freight providers for LTL and FTL loads. These discounts are only available if you create shipments directly through Seller Central and use Amazon’s pre-approved carriers.
In most cases, Amazon’s partnered rates beat outside quotes, even those from negotiated commercial accounts.
| Service | Estimated Discount |
| Partnered SPD (UPS) | 30%–50% |
| Partnered LTL (XPO, CEVA, etc.) | 40%–70% |
While you must comply with Amazon’s strict packaging and labeling requirements to access these rates, the savings are substantial, l—especially for high-volume sellers or those regularly shipping to distant FCs.
6. Reduce Rejected Shipments with Better Labeling and Packing
Neatly stacked boxes in Amazon warehouses demonstrate strategies to reduce rejected shipments and improve delivery efficiency
FBA rejections are costly and often entirely avoidable. If your shipment arrives with incorrect labels, mixed SKUs, damaged boxes, or non-standard pallets, Amazon may either reject the shipment or charge you additional fees for correction.
These mistakes lead to delays, inventory miscounts, and wasted freight costs. Proper prep practices—including double-checking barcode placements and securely packing all cartons—go a long way in avoiding financial hits.
| Mistake | Possible Charge |
| Wrong label placement | $0.20–$0.30 per unit |
| Unscannable barcode | $0.15–$0.40 per unit |
| Rejected pallet | Full reshipment cost |
Based on Amazon seller reports, approximately 1 in 5 shipments that result in receiving delays are traced back to labeling or prep errors, ot transport problems.
7. Compare 3PL and Freight Forwarder Rates
Freight pricing varies widely depending on your route, volume, and carrier network. Many sellers overlook potential savings by sticking with default options like Amazon Partnered LTL when they could secure lower rates via third-party logistics (3PL) providers or freight brokers.
For international shipments, especially from Asia, consider FBA-friendly freight forwarders who understand Amazon labeling and delivery protocols.
| Shipping Scenario | Amazon Partnered Rate | 3PL Broker Rate | Savings Potential |
| 3 pallets to California FC | $620 | $520 | ~$100 (16%) |
| Full container from China | $2,400 | $1,800 | ~$600 (25%) |
Always confirm that your 3PL or freight broker can handle Amazon’s strict delivery appointments and ASN documentation. Mishandled deliveries can delay check-in by days or even weeks.
8. Use Software to Automate and Optimize Shipping
Managing logistics manually might work at a small scale, but as your operation grows, automation is critical. FBA-compatible software can help you generate labels, track freight costs, schedule restocks, and reduce prep errors.
Most tools also offer data dashboards that allow you to compare historical shipping costs and identify which products are the most expensive to move.
| Tool | Functionality |
| InventoryLab | Shipment creation, cost tracking, and label printing |
| RestockPro | Restocking suggestions and forecasting |
| ShipStation | Multi-carrier shipping rate comparisons |
| Sellerboard | Profit analysis, including logistics cost modeling |
Automating shipment creation and integrating freight cost visibility into your inventory management can help reduce administrative time by 20–30% and prevent avoidable prep center errors.
9. Negotiate Better Terms with Your Prep or Freight Providers
Shipping costs are not always fixed. If you’re consistently sending volume to FBA, you have leverage. Many prep centers, LTL brokers, and freight forwarders offer volume discounts, flat fees per pallet, or reduced storage costs if you ask.
Review your past 3–6 months of shipping data, calculate your average pallet count, and initiate a negotiation with your vendors.
Tip: Sellers averaging 10+ pallets per month can often secure flat monthly pallet rates, discounted receiving, or free shrink-wrapping—terms that reduce your cost per unit long term.
10. Eliminate Dead Weight: Audit Unprofitable Shipments
A focus on eliminating dead weight in Amazon warehouses leads to lighter, more cost-effective shipments
Not every product is worth shipping. It’s easy to fall into the trap of sending every piece of inventory to FBA, regardless of sales velocity or margin. Always review your SKU profitability before creating a shipment.
If a product yields less than $5 net profit after shipping and FBA fees, it may not be worth warehousing, especially if it ties up cash flow or increases long-term storage fees.
Sellers who regularly audit their shipping loads and purge underperforming inventory can reduce overall FBA shipping costs by 15–25%, according to Helium 10 seller data from Q4 2024.
Conclusion
Shipping costs are one of the easiest areas to improve once you understand the variables that impact pricing, from carton sizes to shipping method selection, from software automation to vendor negotiation.
In 2025, sellers who optimize these components can see thousands in annual savings and increase their margins without selling a single extra unit. Whether you’re operating at 500 units per month or 50,000, controlling your logistics pipeline will separate your business from competitors who let costs run unchecked.
In today’s fiercely competitive marketplace, securing a sale is just the beginning of the customer journey, not the end. Post-purchase customer experience has emerged as a pivotal aspect of not only retaining clients but also building unwavering loyalty.
Once the transaction is completed, a new chapter unfolds—one that can either transform a one-time buyer into a lifelong advocate or reduce them to just another statistic in the sea of disengaged consumers. Every interaction a customer has after the purchase, from personalized follow-ups to seamless customer support, plays a crucial role in shaping their perception of your brand.
As the dust settles on their initial decision to buy, it’s the ongoing experiences that will ultimately determine whether they return for more or drift away into the clutches of competitors. Understanding and optimizing this journey is not merely an option anymore; it’s a necessity for businesses striving to cultivate lasting relationships in a world where choices abound.
The Path to Loyalty: How Post-Purchase Experience Shapes Customer Relationships
Source: reverselogix.com
The journey to fostering customer loyalty begins long after the initial purchase is made; it is intricately woven into the fabric of the post-purchase experience. Picture this: a customer who eagerly anticipates their delivery, receiving a thoughtful follow-up email that not only confirms shipment but also includes tips for maximizing the product’s use—this simple gesture cultivates a sense of connection.
Afterward, a timely survey asking for feedback demonstrates that their voice matters, transforming a transactional relationship into a dialogue. Each element, from personalized recommendations based on their purchase history to dedicated customer support, deepens trust and enhances the emotional bond.
In this ever-competitive landscape, understanding that retention hinges not on the initial sale, but on the entire journey afterwards, can unlock the secret to creating lifelong advocates for your brand.
Beyond the Sale: The Critical Role of Aftercare in Customer Retention
Source: globalresponse.com
In the whirlwind of commerce, where transactions often take center stage, one critical aspect frequently slips through the cracks: aftercare. This pivotal phase begins the moment a customer clicks “confirm” on their order, extending well beyond the point of sale.
It’s not merely a follow-up; it’s a commitment to nurturing the relationship, a chance to reinforce the connection established during their buying journey. Think of aftercare as the secret sauce of customer loyalty—personalized messages, helpful tips, and timely support can transform an ordinary experience into an extraordinary one.
Customers who feel valued and supported are more likely to return, not just for the products they cherish but for the community and service that accompany them. In a landscape flooded with choices, businesses that prioritize aftercare don’t just sell products; they cultivate loyalty, turning one-time buyers into lifelong advocates.
Conclusion
Source: youngurbanproject.com
In conclusion, the post-purchase customer experience is a critical pillar in fostering retention and loyalty among consumers. By understanding and enhancing this stage of the customer journey, businesses can build lasting relationships that go beyond a single transaction.
Effective post-purchase marketing not only reinforces the value of the initial purchase but also encourages repeat business through personalized communication and ongoing engagement. As companies strive to differentiate themselves in a competitive landscape, prioritizing the post-purchase experience will prove essential in transforming customers into brand advocates, ultimately driving sustainable growth and long-term success.
Transitioning from a trader to a business owner is a thrilling journey, a leap from the exhilarating chaos of the markets into the strategic realm of entrepreneurship. Many traders, fueled by their passion for the financial world, dream of establishing their trading firm—a bold move that promises both independence and potential prosperity.
Yet, this path is strewn with challenges, requiring not just deep market knowledge but also formidable skills in management, finance, and strategic planning. How do you go from analyzing charts and executing trades to overseeing a team of traders and making critical business decisions? In this article, we’ll explore the multifaceted process of building your trading firm, offering insights on everything from legal considerations to cultivating a strong company culture.
Prepare to navigate the nuances of this transition—where the fierce nature of trading meets the intricate art of business ownership. Your journey begins now.
Identifying Your Niche in the Trading Market
Source: udemy.com
Identifying your niche in the trading market is an essential first step on your journey from trader to business owner. Start by reflecting on what truly captivates you—whether it’s forex, stocks, options, or commodities—and the unique strategies you’ve developed through experience.
Tools like depth of market software can play a pivotal role during this process, offering detailed insights into market trends and liquidity levels, which can help you pinpoint areas of opportunity. Dive deep into market trends, analyzing which segments show potential for growth and profitability, while also considering the competition.
Don’t shy away from experimenting; this phase often involves trial and error, as you test different trading styles against varying market conditions. Additionally, leverage your existing knowledge to carve out a specialized area, perhaps focusing on a demographic or asset class that isn’t saturated.
Ultimately, the key lies in blending your passion with market demands, creating a distinctive offering that speaks to both your interests and the needs of prospective clients.
Creating a Business Plan for Your Trading Firm
Source: www.getwork.co.uk
Creating a business plan for your trading firm is not merely a formality; it’s the foundation upon which your entrepreneurial dreams will stand. Begin by defining your vision—what kind of trading strategies will you employ? Will you focus on equity markets, forex, or perhaps cryptocurrencies? This clarity will inform every aspect of your plan, from your target market to your operational framework. Next, conduct a thorough market analysis to identify your competitors and potential clients, ensuring your unique selling proposition shines brightly amidst the noise.
Financial projections are crucial; outline your startup costs, expected revenues, and break-even analysis to illustrate the viability of your venture. Don’t forget to address risk management—how will you safeguard your capital against market volatility? Each section of your plan should weave together, showcasing not only your ambitions but also a pragmatic approach to navigating the complexities of the trading landscape.
This document is your blueprint for success; invest the time to make it comprehensive and compelling.
Legal Considerations for Starting a Trading Firm
Source: luxalgo.com
Establishing a trading firm entails navigating a labyrinth of legal considerations, intricately woven into the fabric of financial regulations. Aspiring business owners must first determine the appropriate business structure—whether a sole proprietorship, partnership, or corporation—each carrying its legal ramifications and tax obligations.
Securing the necessary licenses and permits is paramount; depending on your trading strategies and the markets you operate in, you may need to register with regulatory bodies like the SEC or FINRA. Additionally, compliance with anti-money laundering laws and data protection regulations will shape operational protocols, safeguarding both your firm and clientele. As you forge ahead, consulting with legal professionals proficient in financial regulations is not just wise—it’s essential, ensuring that your firm not only thrives but does so within the bounds of the law, avoiding the perilous pitfalls that could threaten your entrepreneurial dreams.
Conclusion
In conclusion, transitioning from a trader to a business owner by establishing your trading firm is an exciting yet challenging journey that requires careful planning, strategic decision-making, and an adept understanding of market dynamics. By leveraging essential resources, including cutting-edge tools like depth-of-market software, you can enhance your trading strategies and gain valuable insights into market trends.
Building a successful trading firm involves not only honing your trading skills but also developing a solid business framework, fostering a collaborative environment, and staying agile in a rapidly evolving marketplace. With the right approach and commitment to continuous learning, the path from trader to business owner can lead to remarkable growth and fulfillment in the world of finance.
How to Cut Costs on Shipping to Amazon Warehouses – 2025 Update
Is Singapore Real Estate Market a Goldmine for Investors in 2025?
Post-Purchase Customer Experience – Why It’s the Key to Retention and Loyalty
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