Who wants to be Strategic Buyer? A Challenging Voice
A Strategic buyer is the one who is interested in your company in regards to its compatibility with their own long term business planning and requirements. It could either be somebody amongst your competitors or a similar company that is working towards the expansion of its business in your area. The later would fall in the category of a classic strategic buyer.
As opposed to the earlier notion of the strategic buyers being at a disadvantage as compared to the financial sponsors presently the strategic deals are triumphing over the financial ones and in light of this people trust in the strategic buyers in contrast to the private equity guys has increased immensely. This statement can be backed on the basis of an American survey that was conducted recently regarding the strategic-buyer deal making which roughly accounts for around 70% of all the entire acquisitions that are involved in a particular U.S. target. The field of strategic buyers is fast on rise and hence a suitable career choice for the youngsters in the times to come.
For those interested in seeking strategic buyer as a field/career choice they should most preferably have either a master’s degree in business administration or a BA/BS degree in technical competency related to an impressive business and industrial sector. Procurement related experience and further certifications would be an added advantage. In accession to strong administrative and communication skills along with personal strengths will contribute heavily towards the building of a prosperous career in the respective field. Not only is it a competent field but it also pays very well. The strategic buyers earn themselves a lion’s share of their respective deals. With regards to the salary survey conducted in Lincoln, NE for example the average salary that a strategic buyer bags is around $57,000. Apart from that salaries vary in accordance to the respective company and its location, the individuals experience and other fringe benefits.
For those of us who got impressed with the salary figures it would be necessary to remind that it is not all; easy money. The job description for the strategic buyers mainly involves the sourcing of vendors and competitive bids for major purchases. They are responsible for the identification of individual sourcing and should be comfortable working both individually and as a team member. The preparation of performance specifications should be made and maintained in files along with deal details, payment orders and approvals. Direct reporting to the Director of Strategic department is required along with management of all the key activities that are associated with the assigned commodities/services. It is a position that gives the individual ample opportunity for growth owing to its leadership and responsibility requirements.
Choosing the field of a strategic buyer as a career in contrast to a financial buyer is a much better option for two main reasons. One being that the strategic buyers always outbid the financial buyers depending upon how interested they are in the particular company despite having the same debt leverage. Secondly they have a lower hurdle rate that earns them a greater rate of return.
Further the scope of strategic buyers is following an upward trend. They are easily place able in several high paying sectors. In the oil and the gas exploration sector they have been extremely active and have successfully mastered several limited partnerships. Strategists also dominate the electric generation sector and enjoy high cost-of-capital and several additional synergy advantages. It is common knowledge that other buyers seek an honorable retreat if they find themselves pitted against the strategic buyers. In industries such as energy also they have an advantage over the private equity buyers.
In fact in the near future it is speculated that the strategic buyers are going to target the upstream and
the mid stream companies, such as that of oil and gas exploration and production companies and the storage tanks and pipelines respectively. Infact it is being hoped by the investment banks that the strategic buyers will lead revival in contrast to the collapse of the equity deals owing to restrictions on their borrowing powers. Several researches that have recently been carried out delve into the impacts that these buyers have on particular firm/companies integration and performances.
According to the results the strategic buyer and the strategic supplier relation yields a very positive impact on not only the agility but also the efficiency of the respective firm. In fact they are speculated to continue their dominance in the market. Price-Waterhouse Coopers backs these predictions on the basis of prospective media deals that will take place during the course of 2008. In wake of the foregoing events and the factual results it would be safe to conclude that the strategic buyers will continue their supremacy in various sectors not only in the year 2008 but also for many years to come. This fact is complimented by strong principals prevalent in the industry. Although nobody feels comfortable in making predictions but this is a safe assumption and hence as mentioned earlier holds a suitable career choice for students who are seeking high powered and well paying jobs in a competitive and a challenging environment.
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