Every FMCG deal has a story the data room doesn't tell. These anonymised case studies illustrate how the Route-to-Value™ framework surfaces the commercial risks and opportunities that determine whether an acquisition creates or destroys value.
A DACH-based PE firm was evaluating a branded snacks company with €18M revenue. The management presentation positioned the brand as having "strong national distribution" with "market-leading positions in key accounts." Financial DD was underway, and the deal team needed commercial validation of the investment thesis before IC.
The Route-to-Value™ assessment revealed that distribution was concentrated in two retail groups representing 68% of revenue — both with trade terms due for renegotiation within 6 months of expected close. Weighted distribution across the claimed target channels was 34%, not the 72% implied by management. Three product lines contributing 40% of revenue were promotional-dependent, with baseline volumes representing only 55% of total.
The assessment enabled the deal team to: adjust the valuation to reflect trade term renegotiation risk, structure specific warranty provisions around key account contracts, build a realistic distribution expansion plan into the 100-day post-close roadmap, and reclassify €2.1M of promotional-dependent revenue as "at risk" in the investment model. The deal proceeded at a 12% lower valuation with specific commercial protections.
Without FMCG-specific commercial DD, the deal team would have relied on management's distribution claims and discovered the concentration risk post-close — when trade term renegotiations would have hit P&L without protection. An operator who has managed key account negotiations across DACH retail knows what "strong distribution" actually looks like vs. what management presentations claim.
"Distribution breadth was significantly overstated. Weighted distribution across the target channels was 34%, not the 72% implied by the management presentation. The brand was a strong performer in two accounts — not a national brand."
A mid-market PE firm was acquiring a personal care brand operating across three European markets with separate distributor relationships in each. The IC model assumed sales force synergies of €1.8M by consolidating distributor relationships and moving to a single pan-European distribution partner. Financial DD showed healthy margins and stable revenue.
The assessment identified that distributor contracts in two of the three markets contained change-of-control clauses that would trigger renegotiation on close. The strongest-performing market was dependent on a single distributor whose relationship was personal to the founder. Additionally, the brand's pricing in the third market was 15% below the other two — maintained through cross-border grey market activity that would surface as a retailer complaint post-acquisition.
The deal team restructured the acquisition to include a 12-month transition period with the founder maintaining distributor relationships, reclassified the €1.8M synergy target to €600K achievable in year one with full realisation in year three, negotiated specific indemnity provisions for distributor contract renegotiation costs, and built a market-by-market pricing harmonisation plan into the post-close roadmap.
The synergy model assumed a simple world where distributor relationships transfer seamlessly and pricing harmonisation is a spreadsheet exercise. In reality, cross-border FMCG distribution is relationship-dependent and price arbitrage is a ticking bomb. An operator who has managed multi-market distribution knows these dynamics from the inside — not from a consulting framework.
"Modelled synergies assumed stable distributor margins and seamless transition. The change-of-control clauses and founder dependency created a 12–18 month period where trade terms would be negotiated from a position of weakness — not strength."
An acquirer was evaluating a Nordic FMCG distribution company as a platform bolt-on. The target managed distribution for 15+ branded principals across grocery and convenience channels. Financial DD showed flat margin trajectory over three years, and the acquirer was concerned about margin compression in a competitive distribution market.
Deep assessment of the trade spend waterfall and promotional allocation across the principal portfolio revealed €1.2M in recoverable margin from rationalising non-performing promotional commitments. 23% of total promotional spend was generating negative ROI — continuing not because it was effective, but because no one had challenged the inherited promotional calendar. Additionally, three underperforming principals accounting for 12% of revenue were contributing negative net margin once promotional subsidies were allocated.
The assessment provided a concrete post-close value creation roadmap: €1.2M margin recovery from promotional rationalisation (achievable within 12 months), exit or renegotiation of three negative-margin principals (6-month timeline), and a category management upgrade plan to demonstrate value to remaining principals and justify margin improvement. The acquirer proceeded with confidence, using the commercial assessment as the basis for the 100-day plan.
Financial DD saw flat margins and flagged it as a concern. Operator-led commercial DD saw flat margins and identified the cause — and the fix. The difference is pattern recognition: someone who has managed trade spend across FMCG portfolios knows that inherited promotional calendars always contain recoverable margin. You just have to know where to look.
"The flat margin was a trade spend problem, not a structural one. 23% of promotional spend was generating negative ROI — recoverable within the first year post-close. The distribution platform was fundamentally healthy."
The Route-to-Value™ is a commercial compass that assesses 8 diagnostic dimensions specific to FMCG commercial performance. Each dimension is scored, evidenced, and linked to specific valuation and integration implications.
Explore the Framework →The Route-to-Value™ framework — all 8 diagnostic dimensions in detail.
How Arbol supports PE deal teams from screening through IC and post-close.
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The complete acquisition framework — from trade spend to integration risk.