A successful deal is a win for both parties and can be measured in a variety of ways. Each deal is unique, but there are certain traits that every successful partnership should possess.
Prepare thoroughly
Before sitting down at the negotiation table It is essential to prepare well. This includes researching the market landscape and identifying synergies that could be a possibility. It is also essential to know your counterpart’s goals, priorities, and motivations. Understanding the other’s side will help you leverage and help ensure that your deal is successful.
Be Prepared for Unexpected Events
Deal making can be unpredictable and sudden twists in the process can often disrupt plans. Whether it is due to the unexpected discovery of a regulatory issue, an unanticipated lawsuit, or any other incident, it’s important that all parties are prepared for the unexpected. This includes having backup plans and an exit strategy in place in the event that the plan fails to go through.
Identify the Key People
Buyers should focus on retaining the most important team members of a target company after the sale. Acquisitions often fail to retain key employees, which could cause loss of value and slow growth after an acquisition. Understanding the values and culture of the company you are considering buying is essential to ensuring that the acquired company’s values are compatible with the acquiring firm’s. This will ensure that the acquired business will continue to grow its revenue even after the acquisition. It is not uncommon for a company that is buying to experience a decline in revenue after a deal. This is because the acquired team is focused primarily on delivering the synergies and revenue targets that were set prior to the acquisition.