Mergers and Acquisitions

Mergers and Acquisitions for Small Companies

As the owner of a small company, mergers and acquisitions might not seem very important to you. In fact, small companies can learn a lot from mergers and acquisitions -- and even employ mergers and acquisitions for small companies as a strategy for growth.

Mergers and acquisitions are traditionally thought of as an activity that's reserved for large corporations.

While it's true that the most high profile mergers and acquisitions have taken place in large corporate entities, small companies can also benefit from mergers and acquisitions.

As a small business owner, it's in your best interest to learn as much as you can about mergers and acquisitions. Although you may not be in a position to initiate an industry-shaking corporate takeover, you can leverage mergers and acquisitions as a strategy for achieving your goals and increasing the value of your company.

Under the right circumstances entrepreneurs have successfully employed M&A techniques in small business contexts. Here are some of the ways you can follow their example and use mergers & acquisitions to your advantage.

• Become an acquisition target. In a publicly traded company, becoming a target for corporate acquisition isn't always a good thing. But for most small businesses, an acquisition is a laudable goal and a viable exit strategy. The nice part is that you remain in complete control of your company's destiny. But by making your company more attractive for acquisition you will also increase your options.
• Exploit M&A staff fallout. There is almost always fallout from the consolidation of two large companies. As two staffs are merged into one, talented individuals are suddenly thrust into the job market. These workers are enticing recruitment targets for small businesses. As an added perk, they will likely be in the know about their former employer's strategies and eager to bury them in the marketplace.
• Leverage sales gaps. Likewise, the merger of two competitors frequently leads to market opportunities. While the newly formed company is busy trying to merge two houses into one, their customers may feel neglected… at least until you swoop in and present a compelling argument for switching their allegiance to your more service-minded business.
• Study M&A strategies. Mergers and acquisitions provide great learning opportunities for the owners of small businesses. By studying the details of M&A deals, you can gain valuable insights about how small companies get bigger and then implement those strategies in your business. It could even lead to the possibility of using mergers and acquisitions to quickly grow your company.

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