Despite the maturity of the material handling industry, OEMs have continued to find ways to grow and improve margins and—increasingly—that’s been through mergers and acquisitions. In today’s market, it can be tough for manufacturers to stand out. Game-changing technologies aren’t introduced on a regular basis, and differentiating features are often quickly copied by the competition. Additionally, markets are well defined, so expansion through increased marketing or awareness is inherently limited. For many manufacturers, the most effective way to boost business has come from improving distribution networks through expansion or consolidation. The following three M&A strategies have proven successful for several companies recently: Strategy #1: Distribution Expansion Large, well-capitalized dealers can be hard to come by. Training for dealers in the material handling space, as opposed to automotive dealers, is more complex, as dealers have to learn about the products and develop an understanding of the industrial world. Additionally, dealers have to be well capitalized in order to purchase and retain large chunks of inventory. The value of good dealers has many manufacturers making M&A moves focused on bolstering their distribution networks. Methods for doing this include: – Acquiring a competing manufacturer. Buying a competitor gives manufacturers instant access to the acquired company’s distribution channels. This way, manufacturers can strengthen their dealer network in regions where they have a limited presence or none at all, without requiring negotiations with existing dealerships or the establishment of new ones. For example, Mitsubishi Heavy Industries (MHI) recently announced its acquisition of UniCarriers, a joint venture of Nissan and Hitachi, gaining access to its network of dealerships. UniCarriers’ dealer network improved MHI’s access to different geographic regions throughout the United States. The acquisition ensured that other manufacturers, particularly international competitors in expansion mode, could not gain meaningful access to the U.S. market through the […]