History shows that two-thirds of mergers and acquisitions do not meet their expected targets and goals.
The CEO wants to conduct a merger & acquisition feasibility study, considering the profitability and economic effect of brand portfolio management, sales and services systems, distribution management, and warehouse management. This includes revealing the cost savings and benefits through synergies and efficiency changes, headcount balance, new country infrastructure design, required capital investments, and designing and developing the merger transformation task and time plan.
A new category of products offered can add superior value. The new brands can open doors to new service channels and markets. At the same time, a minor incremental cost is added to the current system.
About mergers and acquisitions (M&A)
If done proactively, buying a company in the same or similar business can be a smart strategic move. Experience has shown that perfecting brand gaps is essential and the key to success. Clear, simple rules need to be in place, devised by who is taking over! When merging two companies, the buyer tries to create as many cost synergies as possible. We need to bear in mind that we are not generally just merging companies as such; we are merging the brands and sometimes two company cultures.
When companies merge, experience has shown that the transformation can entail the risk of a revenue shortfall. When two very competitive brands merge without proper planning, often only one brand will sustain its values. The projected savings through synergies will not always become visible as planned. A merger of two company cultures can be complex and requires detailed planning and understanding.
Our approach
Carry out a merger & acquisition feasibility study, considering the profitability, economic effects, and risks regarding brand portfolio management, sales and services systems, distribution management, and warehouse management. This includes revealing the cost savings and benefits through synergies and efficiency changes, headcount balance, new country infrastructure design, required capital investments, and designing and developing the merger transformation task and time plan. Furthermore, design and develop a Master Plan containing a communication plan, design and develop look-of-success standards, and a transformation and merger plan.
Modules and content:
- Feasibility study
- Brand portfolio management
- Technical preparation
- How to go to market
- Look-of-success
- Infrastructure planning
- Rerouting and reorganization
- Training programs
- Transformation Plan
- Measure and monitor key business performance
Results – It was not a good fit
The company was initially bought, and TPC Consulting and the Client recommended and determined to withdraw from the merger and operate as two separate entities. The risk and complexity were considered high when compared to the financial benefits.