Small and medium-sized enterprises across Europe are facing increasing pressure on their margins. Rising energy, logistics and raw material costs—combined with geopolitical instability—are forcing companies to rethink their operating models.

In particular, recent trade policies from the United States have introduced significant uncertainty. After initially imposing tariffs on a wide range of European products (such as steel, aluminum and automotive components), the U.S. administration announced a temporary 90-day suspension to allow for negotiations. However, the absence of a clear direction and the risk of renewed restrictions make the global trade environment highly unstable—especially for export-oriented SMEs.

In this context, simple cost-cutting is not enough. What’s needed is a structural lever. A well-targeted acquisition can provide exactly that—helping to reduce fixed costs, streamline operations and boost long-term resilience.

M&A as a tool for optimization, not just expansion

Mergers and acquisitions are often associated with corporate giants seeking rapid growth. But for SMEs, acquisitions can also serve as a powerful efficiency strategy.

Growth-driven M&A

• Goal: expansion through external lines
• Focus: new markets, products, capabilities

Efficiency-driven M&A

• Goal: cost optimization and operational alignment
• Focus: streamlining, centralization, economies of scale

In today’s uncertain environment, efficiency-driven M&A represents a strategic opportunity to strengthen margins and build long-term stability.

Synergies: the real driver of value

In an acquisition, value does not lie solely in the sum of two companies’ revenues. It lies in what they can achieve together through greater efficiency—what we call synergies.

Cost synergies

• Elimination of duplicated roles and functions
• Consolidation of facilities and infrastructure
• Enhanced bargaining power with suppliers

Revenue synergies

• Broader product offering
• Cross-selling to combined customer bases
• Entry into new market segments

Cost synergies deliver short-term gains. Revenue synergies fuel medium- to long-term growth.

Five concrete levers to reduce costs through M&A

1. Stronger purchasing power
   By consolidating procurement volumes, companies can unlock more favorable supplier conditions and lower unit costs.
2. Eliminating functional overlap
   Shared departments such as administration, IT and logistics can be merged—cutting fixed costs without losing competencies.
3. Facility consolidation
   Overlapping locations can be closed or restructured, delivering savings on rent, utilities and operational overhead.
4. Technology integration
   Acquiring a company with established IT systems helps avoid major investments and accelerates digital transformation.
5. Shared suppliers and services
   Marketing, consulting and software subscriptions can be centralized and renegotiated—cutting waste and duplication.

Selecting the right target: alignment over similarity

Choosing a company that “looks like yours” isn’t enough. A successful acquisition depends on compatibility.

Key factors to consider:

• Comparable cost structures
• Operational processes that can be integrated smoothly
• A culture that aligns—or can be aligned
• Transparent, sustainable financials

Tools like the Assumption Book can guide the selection process, helping assess not only price but strategic fit and impact on your business model.

The advisor’s role: a strategic partner for SME acquisitions

Approaching an acquisition without expert guidance can be risky. A specialized M&A advisor supports the business through every phase:

• Identifying strategically aligned targets
• Assessing potential benefits and hidden risks
• Structuring the deal from a legal and financial standpoint
• Managing post-deal integration

An advisor does more than broker a transaction—they help ensure it creates lasting value.

Final thoughts: acquire to consolidate, not just grow

In a context of economic volatility and unstable trade conditions, every lever that reduces fixed costs and strengthens your business model deserves consideration. For SMEs, M&A is not only about scaling—it’s a strategic choice for consolidation and long-term sustainability.

With the right strategy and professional support, even small enterprises can benefit from intelligent consolidation—and emerge stronger.