Globalisation - Consolidation

Competitive pressures, especially the pressure on sales growth and profit margins, are encouraging companies of all types to pursue globalisation through M&A and industry consolidation. The availability of information technology and data capabilities have made serving and sourcing from global markets easier, thus permitting the adoption of new product and sales strategies, economic models and inventory management techniques to fuel growth. Consolidation, resulting in greater operational efficiencies and economies of scale, is shaping the retail industry and is seen as a way of strengthening one’s position in an industry with fewer, larger players.

The global sourcing of products and the concentration of power within the industry are two factors affecting all retail and consumer companies. Suppliers are under pressure to deliver cheaper priced products and to deal more efficiently with retailers, who want to deliver everyday low prices. Global sourcing and acquisitions have been both a response and an outcome. In turn, retailers needing to increase sales and profit margins are expanding to global markets and consolidating to realise greater power in dealing with their suppliers.

How can PwC help you

PwC has the range of skills to assist companies expand to new markets and consolidate through mergers & acquisitions. Our transaction services specialists can handle the strategic, operational or financial aspects of a deal, while our audit and assurance practice helps companies optimise business functions such as shared services and supply chain, mitigate risks in new operating situations, and provide advice on managing new regulatory environments. In addition, our tax professionals are skilled at providing tax strategy and planning advice across international borders while our human resources specialists can help resolve labour issues in foreign markets and take care of expatriate management.