United States

Adaption is key for consumer products industry

3Q 2015 Consumer Products Industry Spotlight

INSIGHT ARTICLE  | 

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Current and expected growth projections are slowing. A new normal is settling into the global economic environment and the consumer products (B2C) sector is continuing to adjust to this paradigm. Economic indicators in the U.S. last quarter have been relatively positive, and fuel costs have remained lower, yet companies are still figuring out how to jump-start consumer spending into their product lines and services. Currency exposure and a lack of needed investment in business segments have also hindered growth thus far, yet companies are aware of these concerns and consequently, are putting counteractive measures into place.

Growth may remain tepid going forward over the next few quarters, but deal flow should remain strong, as both strategic acquirers and private equity firms still see attractive opportunities in the space. Q2 2015 saw B2C M&A activity improve significantly in comparison to the previous quarter. 440 transactions closed during the period, worth over $59.4 billion in value, representing an increase of approximately 5.52 percent and near 38 percent, respectively, over Q1. Median deal value for the period was up almost 40 percent quarter on quarter, reinforcing the current seller’s market and the willingness of buyers to pay heightened multiples, due to increased competition

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