Business acquisition is a complex endeavor that offers companies a variety of benefits. For example, merging corporations create growth by combining existing customer bases. The resulting enterprise also has more resources than either separate business, allowing it to put more toward production, marketing, and other tasks.

Acquiring a fast-growing small business can also be used to eliminate a competitor. Rather than expending resources fighting with another company over market share, a larger corporation may be able to absorb another business in the same industry, thereby saving the resources that otherwise would’ve been spent on the competition.

Of course, mergers and acquisitions aren’t as simple as adding two companies together. The end result is a single enterprise under one leadership; to reach this result, all parties must negotiate until a consensus is reached and the deal can be made. Should negotiations fall through, one or both companies may have to start the entire process over with new potential partners.

With the stakes so high, it’s essential that all parties do their part to ensure the merger goes smoothly. Fortunately, Andrew Barnett, a business merger expert in Fort Lauderdale, Florida, has six tips to help you through the process.

1. Keep Communication Lines Open

Communication is key in any business, but it’s especially important during a merger. This is true of communication within your team and with the other organization.

M&As have many moving parts and require a huge amount of paperwork, auditing, and legal investigation. Everyone from the CEO to the accounting department administrative assistant has to work together to ensure all the i’s are dotted and t’s are crossed. That’s a massive amount of organization, especially if your company is large.

To ensure there are no misunderstandings or missed messages, you need to ensure that everyone has access to communication. Within your organization, you should have a hub where all the necessary information can be accessed. This eliminates the confusion of multiple communication lines, which can lead to some people missing important bulletins. The same should be established with the party you’re negotiating with, though you may prefer to keep these hubs separate for the negotiating period.

2. Clearly Establish Roles

With the company undergoing such a huge change, you’ll need a top-notch transition team. That means clearly established roles and responsibilities.

The transition team should be comprised of four smaller, interdependent groups:

• Executive team
• Sales and marketing team
• Finance team
• Operations team

Each team needs members from both companies to ensure both parties are up-to-date; all groups should be filled with experts who have experience with the merging process.

The executive team will, of course, act as leaders, but each group should have capable leaders as well. Team leaders are responsible for keeping group members motivated and focused on their primary goal: a smooth transition. Due to the interplay between the teams as well as other departments, team leaders must also be able to communicate clearly, delegate tasks, and anticipate issues.

Perhaps most importantly, team leaders must be able to problem-solve quickly and effectively, as they’ll be the ones employees turn to during a rough patch. Additionally, they should have the interpersonal skills necessary to engage multiple teams to solve a problem, as oftentimes, an issue will affect multiple groups.

3. Get Your Finances in Order

Getting your finances in order is one of the most complicated aspects of M&As. Acquiring another company is an expensive endeavor, both the actual purchase and the long process of merging. Fortunately, corporations have several ways to pay for acquisitions, including cash and shares.

Before you start making offers, however, it’s crucial that you evaluate your company’s assets and determine their value. Negotiations will be tough, and the other business may attempt to undervalue your assets to get the upper hand.

This is where a business merger expert, such as Andrew Barnett can assist. Outside expertise can help you accurately quantify your assets and put them into context; for example, some properties may be more valuable to your corporations and therefore present an imbalance during the negotiating process. Knowing what you have to offer and understanding how it relates to the other party puts you in a stronger bargaining position.

4. Do Your Due Diligence

Due diligence may be the single most important aspect of any M&A process. Before agreeing to a deal or even sitting down at the bargaining table, the other party will want assurances that you’re acting in good faith and accurately representing your business’s worth. Due diligence is akin to laying all your cards on the table; with assurances that the information you’re providing is legitimate, the other party can enter into an honest discussion about how to manage the transition.

Inspection of financial and legal matters is part of due diligence; the process is often called a review, audit, or investigation. For optimal transparency, you should hire an outside expert. This ensures that any issues are brought to the surface and raises your company above suspicion. During the auditing process, your business will need to share certain information:

• Financial statements
• Trade secrets
• Investments

Because of this information’s sensitive nature, you’ll need to invest in cybersecurity to prevent leaks or unauthorized access.

5. Invest in Cybersecurity

Once upon a time, businesses had to print, store, and maintain physical security for M&A documents. Fortunately, technology allows us to leave those days behind.

Many cybersecurity companies offer cloud data storage software that allows you to upload important documents while controlling permissions to your specifications. For example, top executives can access all files, while the operations team is limited to documents related to their responsibilities.

Digital documents are also more convenient than paper. For example, you don’t have to worry about paper copies being lost, read by unauthorized individuals, or inadvertently destroyed. Additionally, individuals can access digital data from anywhere with an internet connection, eliminating the costs and time associated with travel. There are also fewer organizational issues, as administrators can easily create new folders, copy files, and adjust authorizations as needed.

6. Create Concrete Objectives

Last but not least, make sure that everyone on the transition team has concrete objectives. In fact, you want to develop these goals before you start negotiations.

Outline what your company hopes to achieve by merging and make sure each team understands the part they play in meeting those goals. The business you’re merging with may have very different objectives, which means there will likely be compromises. Your transition team needs to be able to keep their goals in sight while meeting the other business halfway.

M&As are major endeavors that require finesse and diligence. That’s why employing an objective third party to facilitate integration is a great option. In fact, in Fort Lauderdale, Florida, Andrew Barnett can help businesses optimize their transition with his expertise and experience.

Your merger can be seamless with the right guidance, resulting in a new organization that’s ready to hit the ground running. So don’t hesitate — if you’re interested in an acquisition, it’s time to start planning now.

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