A successful deal is a win-win for both parties, and can be measured in a variety of ways. Every deal is unique, however there are certain characteristics that every successful partnership should possess.
Thorough Preparation
It is crucial to thoroughly prepare for negotiations before getting at the table. This includes researching the landscape of the market and identifying potential synergies. It is also essential to understand your counterpart’s motives, goals, and priorities. Being aware of the viewpoint of the other party can give you the advantage and ensure that your deal is a success.
Be prepared for the unexpected
Deal-making can be unpredictable and sudden twists in the process may make plans unworkable. It doesn’t matter if it’s due to the sudden discovery of a regulatory issue, an unexpected lawsuit, or some other event, it is essential that all parties are prepared for the unexpected. This can include having a backup plan or an exit strategy in case the plan fails.
Identify key people
Buyers should focus on keeping key team members from the company they are considering buying. Acquirers often fail to retain key employees, which could hurt the value of the company and hamper growth after an acquisition. It is crucial to understand the culture of the target and its values to ensure that it is compatible with the acquired company’s. This will ensure that the acquired business can continue to grow its revenue even after a deal. It is not uncommon for a business that has been acquired to experience a decrease in revenue following an acquisition. This is due to the fact that the team acquired is focused primarily on delivering the revenue targets and synergies that were established prior to the acquisition.