The cheap-money, zero-interest-rate policies of the Federal Reserve, mimicked with increasing skill across global economies, have further fueled the takeover, mergers and acquisitions landscape engulfing civilized nations. As the Trends Research Institute predicted in its Top Trends of 2015, “Takeover” has indeed taken over.
The absence of meaningful regulation governing monopolistic activity, coupled with ease in borrowing to accelerate mass mergers, mean corporate ownership has become a smaller world with vast holdings.
After years of consolidation, product choice has been sharply limited throughout the broad business spectrum… retail, manufacturing, service, communications, etc. With economies slowing and profit margins shrinking, products with small margins and thin returns don’t make it to market. From food to clothing, from digital to stationery and hardware, if they’re not selling big, the product lines are abandoned by the majors.
For example, in the retail sector, while the illusion of wide variety is promoted, it’s only more of the same with a different name. The nearly four-dozen varieties of toothpaste Colgate markets, for instance, are merely one company’s products rebranded and relabeled with minor differences, all under a single brand umbrella.
As items are shed from inventories because they don’t meet earnings metrics, “takeover” opportunities emerge for savvy entrepreneurs who are able to identify the under-served market niches and fill them.
The golden opportunities — recycling, renewing and rebranding product lines discarded by the bigs — will enrich companies large and small, as well as mom-and-pops. Among the segments to capitalize on are health and well-being services and products to meet the needs of an aging, drug-dependent, obese, overstressed society seeking new modalities and different solutions.
Complementary to the burgeoning whole-health-healing trend are the ever-expanding “green” and buy-local trends that are anathema to the “bigs” but provide golden opportunities for “ontrendpreneurs” who identify the gaps left open by mega-companies.
Moreover, bottom-line pressures have pushed major corporations further away from aggressive research-and-development pursuits. Robust R&D for products that may reap rewards later are often sacrificed by companies that monopolize market share and are more concerned about short-term profit-potential than fertilizing new ideas and product development in the long term. TJ