Belgian manufacturing is under pressure, but within this pressure lies an opportunity. Across the sector, consolidation is gaining momentum. Many SME CEOs are asking: how will we grow (and survive) into the future?
Consolidation as a strategy
Consolidation isn’t simply about survival, it’s about opportunity. Deal activity may have dipped in 2023, but Belgian SMEs remain optimistic: 63% of entrepreneurs see this as a good time to acquire another company, according to Marktlink. PwC’s 2024 Belgian M&A survey confirms this shift too: corporates and financial investors alike are preparing for buy-and-build strategies.
Choosing what to buy, and why
In the past, manufacturers focused on vertical integration: acquiring suppliers or buyers in the chain. Today, the scope is broader. Companies are adding adjacent capabilities , acquiring firms for their innovation potential, not just incremental scale.
Think of it like this: your company is the stable, reliable tanker, but you also want speedboats: agile, innovative, capable of entering new spaces. The challenge? Finding a balance between protecting your core business and experimenting beyond it.
How much time, resources and energy do you allocate to new ideas? When and how will they be integrated? These aren’t easy strategic questions.
The spread dilemma: innovation versus identity
As you explore acquisitions:
- Do you replicate core capabilities or extend into new, adjacent areas?
- Is there overlap with your existing clients, or a risk of too much divergence?
- How do you ensure innovations don’t dilute your brand at home?
Ambition is great, but these trade-offs require clarity too!
Why timing matters, and what it means for Belgian manufacturers
Despite a small decline in deal volume, valuations in Belgium remain at record levels, especially for strategic SME targets, according to Vlerick Business School’s M&A Monitor (vlerick.com). That tells us: investors still value resilience, niche leadership, and technological and commercial readiness.
A three-step path to smart consolidation
A practical framework manufacturers can consider:
- Evaluate your core and adjacent opportunities. Map which acquisitions reinforce your existing strengths and which open new horizons.
- Assess your organisation’s readiness. Commercial maturity, leadership structure and operational integration capabilities are all critical before you execute a deal.
- Balance exploration with protection. Be willing to invest in new ventures, but only once you’ve clearly defined which part of your business must stay intact.
Why companies need an outside-in view
Merluno helps manufacturers navigate this complex landscape. Whether it’s assessing your market readiness, identifying adjacent capabilities that align with your identity, or planning how to integrate new acquisitions without losing sight of your core strengths: we guide you through the process step by step.
Because in challenging times, consolidation can be your smartest move forward.