Synopsis: Pump Manufacturer — Acquisition
Our client was exploring acquisition candidates as a way to grow his business in Europe. He had identified a European manufacturer that appeared to complement their product lines and would increase coverage of the European market. He asked QDI to conduct a fast turn-around study to assess the company’s performance in the market.
This type of research is a standard for QDI’s clients who are undertaking acquisitions. The voice of the market – both channels and major customers gives tremendous insight into how the acquisition candidate is actually performing in the market as well as threats or opportunities facing the candidate.
QDI conducts this research by targeting the top distributors and customers. Usually a small sample, covering the key geographies and market is all that is necessary or all that the client has time for, as the projects usually have a two week time window. Usually in this time frame our consultants can conduct about 40 interviews across this sample base.
We studied the acquisition candidate’s distribution, end-user franchise and recent strategic initiatives. Key areas where QDI was able to provide insight to our client included:
- The client’s share position in the customer’s / distributor’s business. How important was the product category? Was the company gaining or losing strength.
- What major changes were happening in the market?
- What role was the target company playing in leading the market?
- What level of satisfaction did the target company have with each of these players? Was it improving or decreasing?
- What challenges and opportunities did these market players see for the company?
This powerful market insight directly affected our client’s decisions on the overall marketing fit and valuation of the target firm.