Litmus Partnership reveals research into contractor mergers

04 September 2015 by
Litmus Partnership reveals research into contractor mergers

Product and service quality, good communication and continuity are the most important factors for clients when it comes to business mergers and acquisitions, according to the Litmus Partnership.

The catering and facilities management consultant conducted the research following several recent high profile mergers and acquisitions within the sectors. These include CH&Co and HCM, Lexington and Elior, ISS and GH Hall, and WSH and Searcys.

Litmus decided to undertake the study to discover the impact of change and to determine the hopes and fears of clients.

Nigel Forbes, managing partner at the Litmus Partnership, said: "Given the period of consolidation the services sector has been going through, and will likely continue to go through, it was important to find out what clients really feel about this issue.

"Many assumptions are made by clients and contractors alike but this is the first time that detailed research has been completed to reveal how clients really feel in these situations.

"The overall impression is that clients prefer that there be no change but if there is change, the critical factors for contractors to address are good communication and continuity of service and product quality.

"Most clients appear to trust the relationships they have built up with their contractor and are prepared to give them the space to watch how things progress but we also know that many will consider retendering if standards slip."

Research found that clients preferred stability, with 74% stating they would prefer no change in contractor status. The second preference (60%) was for their contractor to be acquired by another contractor and third choice (46%) was for a merger with another contractor.

The biggest concern was that service and product quality would reduce (82%), with 62% of clients confirming they were worried that costs would increase as a result of the change.

CH&Co and HCM Group merge >>Elior buys Lexington Catering >>

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