Private Equity companies strive for top returns. In order to realize an internal rate of return (IRR) of greater than 20% p.a. it is essential to generate added value in the portfolio. Financial engineering or cost optimization are useful methods to achieve this. However, these measures are usually not sufficient to realize superior returns.

Market-relevant parameters are the most effective levers to optimize profits. Thus it is even more astonishing that these measures are often neglected in day-to-day business, leaving significant room for improvement.

SKP supports leading Private Equity companies worldwide in all stages of the investment lifecycle:

Buy - Market/Commercial Due Diligence:

Evaluation of an investment from a market perspective (including assessment of its future potential). Key questions consist of:

• Identification and evaluation of risks and opportunities of an investment from the market, technology, customers, and competitors

• Validation of the business plan (top-line development)

Team structure is a key success factor. Consultants with excellent expertise in transaction processes team up with consultants who are experienced in the relevant industry.

Grow - Added-Value Strategies:

Definition and implementation of clear-cut measures to exploit market-relevant profit potential, e.g.:

• Clear-cut pricing measures (optimization of price level, elasticity-based price differentiation, discount optimization, price monitoring)

• Sales force optimization, (introduction of a systematic sales approach, reorganization of incentive system)

Sell - Vendor Due Diligence:

Support in realizing an adequate purchasing price by defining and clearly communicating key selling arguments.

Selected SKP Clients