What’s the key to successful Retail M&A?

The critical role of people and culture in retail mergers and acquisitions

Summary:

Many Retail & Consumer M&A deals fail to realise full value due to overlooked people and culture factors. With rising costs and strategic shifts, businesses must balance integrations with maintaining brand DNA, consistency of culture, while ensuring people remain focussed on core delivery. Q5 helps organisations embed a people-centric approach to maximise synergies and drive long-term success.

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Mergers and acquisitions in retail

In the Retail and Consumer sector, successfully realising synergies during the mergers and acquisitions (M&A) process is more critical than ever, especially amid headwinds such as rising national insurance contributions and increased minimum wage requirements.

There are two main reasons our clients are pursuing M&A:

1. Divestment of non-core assets: Streamlining portfolios by disposing of underperforming or non-essential assets, particularly in low-margin categories.
2. Strategic acquisitions: Pursuing deals that enhance brand DNA and align with operational goals.

Headcount costs account for anywhere between 20% to 30% of Retail & Consumer organisations cost base, but people impacts are often neglected in a divestment or acquisition plan, significantly impacting the ability for an organisation to unlock the anticipated value.

Types of questions our Retail and Consumer clients face during the M&A process include:

• How to maximise integration value while maintaining Brand DNA?
• How to create a common thread of culture, ways of working and governance across the portfolio?
• How to keep people focussed on core delivery throughout the acquisition or divestment period?

More than two-thirds of M&A activity fails to deliver anticipated value, often due to cultural, governance, or strategic disconnects. At Q5, we understand that embedding a strong focus on people and culture into your M&A approach is critical to achieving sustainable, long-term value. By addressing these factors early, Retail and Consumer organisations can accelerate synergy delivery and build a resilient foundation for future growth.

Curious about how we help Retail and Consumer companies to maximise value through deal activity? Get in touch with our experts:

Dan Upward

Daniel.upward@q5partners.com

Partner, Retail & Consumer

Matt Phelan

Matt.phelan@q5partners.com 

Head of Retail