What is Distribution Merger & Acquisition’s Next Frontier?

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There are many things to consider when growing and expanding distribution operations.  For the electronics distributors, the last twenty-plus years were focused around mergers and acquisition.  Why reinvent the wheel when there are complimentary companies that can fill the need you want for your company and your customers?  Mergers-and-acquisition activity is likely to continue in the electronic distribution industry, as well as other distributing industries.  Their success will be driven by the ability to create efficient regional channels and expand their footprint in newer markets.

Whether you work with or merge with supply chains and other distribution facilities, communication is critical to building a successful relationship.  Integrating information systems and enterprise resource planning (ERP) software solutions gives you the ability to collect and monitor important data that can drive growth for the newly merged enterprise.  You will want to pay close attention to discover how operations are related from one site to the next so that you are building your business, not stifling it.  Some regions may not be equipped with reliable infrastructure and logistics.  Even IT can require special attention.  Building this infrastructure and improving communication is a top priority for both your business and the business you have merged with or acquired.

Paying close attention to the regional channels in the new market area is also important for a successful merger.  You are likely to find that the local distribution partners are reliable for local needs.  Keeping the local workforce can be beneficial to maintaining loyal customer satisfaction during and after a merger or acquisition.  After all, they are most familiar with the regional contacts, customers, and customs that have made them successful in their area.

While the United States may still be on its way to recovery from our economic challenges, other countries are experiencing faster growth.  Expanding into areas such as Mexico, Brazil, and Turkey could be complimentary to a possible expansion that could further boost recovery efforts.  Merging two businesses to create a successful expansion can be challenging, but rewarding when done well.  A good merger will enable you to provide your entire customer base with quality products, at reasonable prices, and within appropriate time frames.  Contact OmniVue for more information about how to build and strengthen relationships whether you are working with or merging with other businesses.

By OmniVue, a Microsoft Dynamics GP and NAV Partner out of Georgia

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