9 Feb 2022
Consulting, legal and financial services businesses have historically been reliant on the people employed for their customer relationships and service delivery; this reliance was often reflected by lower business valuations and extended consideration periods. Increasingly, additional value is being created with the introduction of automated systems, data gathering through APIs and other digital interfaces which deskill repetitive areas of service delivery and free human resources to provide higher level strategic thinking and decision making. Firms which can develop efficient scalable services which provide insight have and will become very valuable. This sector is ripe for investment with many funds looking to help firms transform through technology.
BUSINESS PROCESS OUTSOURCING
This can be outsourced information technology-enabled services, knowledge process outsourcing or manufacture/fulfilment outsourcing. As organisations focus more on their core offering, greater elements of their required services are outsourced. Private Equity and banks are keen to fund the growth of businesses with high-quality contracts and consolidators are looking for meaningful transactions from which they can build scale. Top prices will be paid for a well-positioned business.
MARKETING & COMMUNICATIONS
Whilst the move to digital has driven this sector, human creativity is still the foundation stone. To achieve an organisation’s full potential, there needs to be a great balance between its brightest minds, the automated systems and the myriad of communication methods available. Firms which can use data analytics to maximise engagement with target audiences are very attractive to investors, as are organisations which provide the analytic tools. Firms find they often lack the resources to change their business models, but we introduce suitable investors with the expertise and funds required.
With commercial and residential property users requiring an ever higher quality built environment and the increasing burden of security and compliance the future for facilities management (FM) providers looks strong. Many firms that provide building services, security, cleaning or other ancillary services are being consolidated to deliver higher quality and scale. We have helped owners of businesses which are not FM business but have some FM characteristics make the changes required to get an FM price. Often this is best achieved with a partial exit to a private equity firm with experience in transformation.
We have worked with a number of businesses be they straight hire or “wet” or “operated” hire. A correct understanding of the true asset value, ongoing CapEx requirements and asset utilisation will position a business for a successful sale. If a business has great technology, this will drive an enhanced price.
LOGISTICS & DISTRIBUTION
Order fulfilment and delivery of IT supplies, consumer delivery or just-in-time manufacturing processes rely on quality systems and efficient asset usage. Attractive businesses that facilitate those systems or have developed powerful market positions due to strong asset use or tight geographic density can deliver value for investors and owners. Inefficient or weak market participants need to consider what changes they can make to thrive, often through bolt-on acquisitions or investment in technology. We can help raise the funding to enable future success.