Client Context
A global cosmetics ingredients company sought to acquire a Chinese emollient player but lacked a local presence in China. Our critical role in the commercial due diligence process involved understanding the target's commercial prospects.
Our Approach
Conducting a thorough commercial due diligence study, we focused on both internal and external aspects. Internally, we researched the target's management, ownership structure, revenue, expenses, production capacity, sourcing, and operations through extensive Chinese and English desktop research, as well as local company records in China. Externally, we examined sales channels, distributor relationships, international footprint, strategic partnerships, and future plans. We also assessed the target's position relative to competitors' and customers' perceptions. This research involved in-depth interviews and conversations with Chinese market participants.
Impact
Our actionable target intelligence not only allowed our client to approach their negotiations with greater confidence and leverage but also provided invaluable insights for strategic decision-making. Armed with a comprehensive understanding of the Chinese emollient player's commercial situation and future prospects, our client made informed choices throughout the acquisition process. The acquired insights not only facilitated a successful acquisition but also positioned our client for enhanced growth and competitiveness in the cosmetics industry.
Related:
- Practice Area: CPG Value Chain
- Geography: China
