challenge facing middle market companies
If you are a typical middle market company trying to move your company to the next level, you may face some of the following challenges:
Your company may have gained a majority of clients during favorable market conditions and mainly through referrals. You may have not taken the necessary steps to build a strong marketing and sales team to generate new clients on a consistent basis. You wish to build a strong marketing and sales force; however, it requires more capital than you are currently able to invest.
After having obtained your original funding from a venture capital firm, you may have spent your last dollar on property, product development, and marketing. You then realize that you may have developed a great product, which the market demands. You are able to get several customers to purchase your
product(s) and/or service(s); however, your current cost structure does not allow you to benefit from economies of scale. In order to
commercialize and standardize your product, you may need millions of dollars of additional investments.
Your company's revenue growth has reached a plateau. Additionally, you have spent millions of dollars to update your equipment. Every year, your capital expenditure is high, and your profit margin remains to be low. You are struggling to increase your revenue, but you are not able to reach the grow rate you are aiming for.
these challenges sound familiar selling or merging with a stronger player that
can help your company reach the next level is an option you may have
considered. Franklin Hamilton can help you in your merger strategy and
provide you the information you need to determine market conditions for the sale
or merger of your company.
Selling or merging may be your best option
Selling or merging with a financially strong company may be your best option if you are facing some of the challenges mentioned above.
First of all, as you may already know, the IPO and venture capital markets have been dried up for over six months; and it is unlikely that these areas will not be reopened for some time. Selling or merging is probably the only option for you.
Furthermore, strong buyers typically have overwhelming marketing and sales forces, and tend to sell multiple products and services pertaining to your industry. If you have a marketable product and service, they are capable of quickly integrating them and help you move your business unit to the next level faster than you are able to accomplish
alone. In addition, strong buyers typically possess more resources than you. These resources are not simply limited to capital resources; but also, those within development, research, marketing, and etc. Whether you need to commercialize your product to benefit from economies of scale for your product and service or reach new customers, you will have tremendous advantage over your competitor if you join forces with a strong player.
At Franklin Hamilton, we focus our attention to two essential objectives for our clients. Our primary responsibility is to introduce and bring you multiple buyers in order to increase your final benefits. Secondly, we put our efforts in matching your company with the right buyer.