Member Article

Growing Your Business: The Power of Acquisition

By Gareth Smyth, CEO of Hilton Smythe Group

In fiercely competitive industries, such as hospitality, leisure and retail, entrepreneurs are constantly seeking ways to expand their businesses and stay ahead of the curve. While organic growth has traditionally been the go-to method, an alternative strategy has been gaining traction—mergers and acquisition.

At Hilton Smythe Business Advisers, we have been working with Northern Catering Equipment (NCE), which recently purchased Walker Catering Supplies Limited, a Nottingham-based catering supplier, to increase its market share of the catering supplies sector.

Rapid Expansion and Market Penetration:

Acquisition offers a fast-track approach to expanding your catering business. Instead of investing years in building a brand from scratch, acquiring an existing business allows you to immediately access an established customer base, brand recognition, operational infrastructure and, ultimately, cash flow. This speedier market entry can help you gain a competitive advantage and quickly increase your market share. Mo Romanowicz, Managing Director of NCE, said: “Since I started in 2017, I’ve been growing my business from a one-man-band to a nationwide operation, and by acquiring Walker Catering, I’ve increased my customer base by at least 1000 immediately. It also gives us the potential to work with new markets which we may be introduced to through the legacy Walker clients.”

Access to Established Relationships:

As Mo mentioned, acquiring a catering business grants you instant access to an array of established relationships, including clients, suppliers, and industry contacts. These relationships, built over time, can be invaluable in driving growth. By leveraging the acquired company’s network, you can secure new contracts, forge strategic partnerships, and tap into lucrative markets that may have been otherwise challenging to access organically.

Diversification of Offerings:

Expanding your business through acquisition opens up opportunities for diversification. You can acquire a company that specialises in a different cuisine, event type, or service segment, allowing you to broaden your service offerings and cater to a wider customer base. Diversification mitigates the risks associated with relying heavily on a single niche and helps future-proof your business against changing consumer preferences.

Talent and Expertise Enhancement:

One often overlooked benefit of acquisition is the opportunity to acquire talented staff and experienced industry professionals. The acquired team can bring fresh perspectives, expertise, and operational knowledge that can elevate your business to new heights. Acquiring a business with a strong management team can also provide you with valuable insights and leadership capabilities, helping you scale and streamline your operations effectively.

Mo Romanowicz said: “We were very lucky that when we acquired Walker Catering, 13 talented staff joined us, including three very experienced members of the management team. Their support has been invaluable and ensures that existing clients get a seamless transition to NCE.”

I’ve been involved in the purchase and sale of businesses for more than a decade, and as such, I have myself ‘acquired’ some advice for entrepreneurs looking to grow their businesses.

Thorough Due Diligence:

Before proceeding with an acquisition, conduct extensive due diligence to ensure you understand the financial health, market position, and reputation of the target company. Assess its existing contracts, customer base, brand equity, and potential liabilities. Engage legal and financial experts to assist you in the process, ensuring that you have a comprehensive understanding of the risks and opportunities associated with the acquisition.

Mo Romanowicz said: “Hilton Smythe supported us every step of the way to ensure everything was in order when purchasing the business. It was a relief to know that I didn’t need to worry about that side of things. Everything was explained clearly to us and the deal was looked over with a fine tooth comb.”

Cultural Alignment:

Successful integration of the acquired business into your existing operations requires careful consideration of cultural alignment. Evaluate the company’s values, work culture, and employee dynamics to determine if they align with your business’s ethos. A harmonious cultural fit can facilitate a smooth transition and increase the chances of employee retention, customer satisfaction, and overall success.

Integration Planning:

Develop a detailed integration plan to seamlessly merge the acquired business with your existing operations, and don’t rush! Clearly define roles and responsibilities, streamline processes, and establish effective communication channels. Maintain transparency and provide ongoing support to the acquired employees to foster a sense of belonging and facilitate a smooth transition.

Mo Romanowicz said: “We worked closely with Walker’s existing staff and communicated with them openly to ensure they understand how we work and feel included in the NCE Group family from day one. We felt it was essential to keep them on board and part of the team, because they are important to our growth strategy.”

Customer Transition and Retention:

Retaining the acquired company’s customers is crucial for long-term success. Implement a robust customer transition plan, ensuring minimal disruption and maintaining the highest level of service during the integration process. Communicate openly with customers, addressing any concerns, and emphasising the benefits of the acquisition, such as expanded offerings and improved capabilities.

Growing a business through acquisition offers numerous benefits that can help you expedite growth, gain a competitive edge, and diversify your offerings. However, it is essential to approach such deals with careful planning, conducting thorough due diligence, and ensuring cultural alignment and effective integration. By harnessing the power of acquisition, the sky’s the limit with your business growth.

This was posted in Bdaily's Members' News section by News Gathering .