KBS - Food Manufacturing - Market Insight

WHAT TYPES OF BUSINESSES ARE STRATEGIC ACQUIRERS PURSUING?

In the UK food manufacturing and distribution sector, strategic acquirers are targeting companies that can enhance their market presence, diversify offerings, and deliver specialised expertise. Ideal acquisition targets often exhibit niche capabilities, strong customer relationships, impressive growth metrics, and alignment with consumer and regulatory trends in sustainability and innovation.

+ NICHE PROVIDERS AND SPECIALISED EXPERTISE Acquirers seek businesses offering highly specialised products or services that bring unique capabilities to their portfolio. Companies with expertise in areas such as plant-based foods, sustainable packaging, or artisan goods are particularly attractive. + HOLDERS OF PROPRIETARY TECH OR PROCESSES Businesses with proprietary technologies or innovative production methods—such as efficient food waste management systems or exclusive recipes—offer competitive advantages. Intellectual property that enhances production efficiency or product differentiation is highly valued. + STRONG CUSTOMER RETENTION Companies with loyal, long-standing client bases and strong retention rates are prized for their predictable revenue and potential for upselling value-added services, such as premium delivery or customised packaging.

+ HIGH-GROWTH AND HIGH-MARGIN OPERATIONS Firms with a track record of rapid growth, or those operating in high-demand segments such as healthy eating, convenience foods, or premium goods, are prime targets. Strategic buyers value strong revenue growth and healthy profit margins. + SME-FOCUSED DISTRIBUTION NETWORKS Acquirers are drawn to firms with established distribution networks, especially those catering to SMEs, which often require tailored services. These networks can provide recurring revenue streams and opportunities for cross-selling or expanding product lines. + ACCESS TO NEW MARKETS OR RE GIONS Strategic buyers are also targeting firms with a presence in underserved regions or emerging market segments. Companies offering an established foothold in growing regions or demographics, such as younger consumers seeking health-conscious products, are particularly appealing.

By focusing on these types of acquisitions, strategic acquirers in the food manufacturing and distribution industry aim to build robust, future-ready businesses capable of addressing evolving market demands.

In recent years, trade consolidators’ interest in acquiring food manufacturing and distribution companies has been driven by the need to achieve scale, enhance expertise across the supply chain, and strengthen market position in a highly competitive and constantly evolving industry.