FOSTEC & Company offers a portfolio of Due Diligence services, which may be divided into four (Figure 1). First, we will examine the target´s scalability within a Commercial Due Diligence (CDD).
Besides of the overall CDD approach an in-depth analysis of the target´s E-Commerce business is required. EBDD´s goal is to analyse the target´s overall E-Business maturity level.
If you consider an acquisition of, for example, a software development company, then a deep dive IT & Technical Due Diligence is recommended. Specifically, FOSTEC will examine the code quality and the target´s IT rights.
Finally, personal resources play a pivotal role also in digital & E-Commerce companies. Therefore, FOSTEC recommends conducting an HR & People Due Diligence before the buying decision. Thus, we determine which people capacities the target has and how the target´s growth in the next years can be achieved with the resources available today.
Figure 1: M&A buy-side support by acquisition of digital & E-Commerce targets
While FOSTEC & Company possess Due Diligence expertise across industries, we have focused on the following branches (Figure 2).
Figure 2: Due Diligence expertise of FOSTEC & Company across industries
The CDD´s purpose is to evaluate the target´s business model scalability. The CDD´s core task is to examine the target´s strategic fit to the investors´ portfolio. Next question is how large the synergies are which may be realized after the acquisition and how sustainable the collaboration with the target for the rest of the investor´s businesses will be. This will be achieved by analysing both the target´s present performance and the market growth expectations. In total, two internal and two external spheres will be examined, as shown in Figure 3.
Figure 3: Areas to be analyzed within the Commercial Due Diligence
First, the analysis of the external areas will demonstrate how attractive the target´s market is. Furthermore, FOSTEC will evaluate the specific framework conditions, which also impact the target´s business: degree of technology and economic development, market growth and trends, customer behaviour.
Second, FOSTEC will analyse the target´s business strategy and core internal competencies. Thus, areas such as supply and value chain, target´s USPs, technologies applied and management power will be evaluated.
Our Due Diligence services are a solid foundation for investors´ strategic decision making in the field of digitalization and E-Commerce. FOSTEC & Company as a Europe´s leading strategy consulting boutique is looking forward to your requests regarding company valuation and Due Diligence.More information about our Due Diligence services
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Markus Fost, MBA, is an expert in e-commerce, online business models and digital transformation, with broad experience in the fields of strategy, organisation, corporate finance and operational restructuring.Learn more