by Mark Lagasse
There are some truisms in business, “Everyone in the organization needs to be rowing in the same direction” or “The organization is only as strong as its weakest link”. There is also a truism when it comes to growth, “It is much faster to grow through acquisition than organically one customer at a time”. Why would you want to risk expanding your geography by scratch starting new locations or sales territories when you can purchase an already operating sales base.
What is important to consider however is that increasing the size of your business significantly virtually overnight will put pressure on both the base business and the acquired entity. That is why it is very important to assess your current infrastructure, resources, and operating processes. This includes determining the “bandwidth” of your company’s systems and management personnel. The focus should be to answer the following questions: Can your organization handle a large increase in workload? What resources do you need to implement a growth through acquisition plan? And how will you ultimately integrate a new business into your existing operation?
BTS can help you formulate and implement pre-acquisition plans. We can help you determine what type of target would best meet your growth goals. And we can prepare a potential target list. We can also offer high level preliminary due diligence and help identify and quantify the synergistic benefits of an add-on acquisition.
Whether you need to prepare for a sale or a purchase, let BTS help you get it done right. Please send us a note or give us a call. We will arrange a no obligation discussion of your situation and options. One way to easily do this is to complete our confidential contact form or via email.
"The entire process went smoothly and professionally. The BTS team kept me fully informed at every step. They worked hard and were effective in bringing the deal home."
"Skip and I continue to be grateful for all you have done to make the sale of Pure Flow come to fruition."
"BTS’s level of expertise in the process and close attention to detail enabled us to successfully navigate the deal."
"These types of transactions are often long and complicated and I doubt it could have been successfully completed without your close ongoing involvement."
"The outside objective point of view that you have brought us has been invaluable as we prepare for the rapid growth."
"John then found the right buyer and coordinated a seamless transition—he doesn’t miss a single detail."
"John immediately identified our strengths and experiences and discussed a business that ultimately was more in line with our goals."
"The BTS team came in, evaluated everything in a professional and thankfully non-threatening manner."
Private Equity Trends
More and more PE firms are searching for smaller transactions. The reason for this is simply competition
Using a Specialist in M&A
While using an industry specialist to market a company may save a few days in preparing the offering materials, there is the danger of a cookie-cutter approach.
Legal Breakfast Series: How I Sold My Company - A Case Study
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What's Next Really Matters
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Tailwinds Continue for M&A Deals in 2017
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There is also a truism when it comes to growth, “It is much faster to grow through acquisition than organically one customer at a time”.
Is 2017 the time to act?
Wrapping up 2016, and considering key initiatives of the year, we see trends that we believe will continue for New England M&A in the year ahead. Key things we are seeing:
Precision Machining Company
Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production.
Green Product Company
Our client owners could dig in for the long haul…However, this would take five years or more. Owners simply lacked the horsepower to do it.
Water Purification Company and Young Buyers
Owners decided they wanted to retire. They also wanted to be fair to the staff who had been loyal to them. Could the company be sold, the staff retained and the facility remain in use?
Magnetics Company with High Profile Customers
(T)he manufacturer would need to focus on growing EBITDA to capture interest from major strategic buyers and achieve a higher multiple of earnings.