Looking To Grow Your Business Through Acquisition

Seven Questions To Ask Pre Acquisition

1. Why do I really want it – vanity / sanity
2. Have I done my sums – overall it will inevitably cost significantly more than expected
3. Does it make financial sense
4. Can I live with the outcomes – 50% are unsuccessful
5. Do I have a plan – Many businesses don’t have a clear strategic plan for their core business let alone an acquisition
6. How will it fit in – see point 6
7. How long will it take – Guess what it will take longer than expected (and consume a lot of time)

Growth Acquisition Strategies

• Acquisition will allow the existing business to improve its performance
• Acquisition will consolidate the industry and remove capacity
• Acquisition will accelerate market access
• Acquisition will allow you to acquire skills or technology (as opposed to doing your own development)
• Acquisition will allow you to pick a winner early
• Roll up – buy lots of little businesses to achieve a consolidation. Difficult as it becomes obvious what your doing so prices start to increase
• Consolidate to improve behavior – need to get senior players on board
• Transformational merger

3 numbers to consider

1. Your maximum price
2. What the vendor will accept (you need to know their circumstances health, family, debt etc)
3. What values are really being achieved

Looking to grow your business through acquisition

Remember 50% success on acquisitions could you achieve growth organically, have you got clear strategies in place to maximise organic growth. For more information on business development click here 

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