Retail Mergers and Acquisitions: Who stays and who goes?

Retail Mergers and Acquisitions have been happening left, right and centre, particularly over the past few years and it doesn’t take a genius to work out why. It’s public knowledge that many bricks and mortar retailers have found it difficult to compete with their online counterparts, which has had a major impact on their sales and profits. This leaves them in between a rock and a hard place. Do they admit defeat and shut up shop for good or do they do something more drastic to turn their struggling sales around?

While many opt for the former when times get tough, there are retailers out there who are more open minded about trying more radical measures. This is where mergers and acquisitions come in. Over the past year, there has been a 15% rise in retail sector mergers and acquisitions as large retailers see the benefits of joining forces.

A merger enables retailers to increase their size, lower costs, and provide a wider variety of products to entice consumers back to their stores. All of which gives them more stability to take on their competition. Which is exactly what has happened in the case of the £10bn merger between supermarket giants Sainsburys and Asda. While the merger is set to combat their dropping sales, it’s also been done to create a powerful rival for the seemingly unstoppable force of Tesco.

Quality of talent

The financial benefits of mergers are undoubtedly appealing. But there is also another benefit that they can bring to the table. When retailers merge, their workforces also merge, which can give some organisations an ideal opportunity to increase the quality of their talent. However, having a sudden influx in staff can mean that there are just not enough roles to go around.

Usually it’s the more dominant partner in the merger who makes the final decisions on which employees can stay and who goes. Their decision is often based on future strategies agreed upon during the merger and acquisition process and the skills they require from their workforce to meet them. So, for instance, if there are two people for every position after the retailers have merged, the stronger of the two is likely to be kept on board.

In some cases, this is the easiest decision in the world. But what about when you’re faced with two candidates with very similar skillsets and experience, both vying for the same retail project manager job? The only way to differentiate between the two is to focus your attention onto their non-job specific skills. To help you retain the best possible talent during this exciting time of change, here are some key skills your chosen candidates should possess.


This is one of the most important skills for your chosen candidates to have. During any merger there’s always going to be a period of adjustment, where employees work out where they fit within this new organisation. Even though they might be staying, there is a good chance that their roles and responsibilities will change to suit the merged organisations goals. They might have to get their head around the different policies and procedures that are different to the ones they are used to, or they might go from leading a team, to being led by someone else. They could also be removed from teams they’ve worked with for years and be now working with people from very different backgrounds to their own.

Those who are open-minded and willing to change have been found to find major transitions like this a lot easier than those who are stuck in their ways. Your employee morale and productivity can be greatly affected if the candidates you choose to stay don’t have the foresight to embrace the changes imposed by their new organisation, which is understandable not the outcome you want.

Problem-Solving attitude

Problem solving is a skill that links closely to many jobs within the retail sector. But rather than just considering how a person tackles issues in their job, also consider their attitude and mindset to sudden changes too. Have you noticed that one of your potential candidates gets anxious, frustrated or even angry when things don’t go quite according to plan? If the answer is yes, then they probably aren’t the best person for this new role.

Even with fantastic communication and expert planning, things can and will go wrong during a merger and you need employees who will be able to act calmly and practically. They should approach problems, both big and small, in a positive and optimistic manner in order to find a quick resolution and to inspire ideas sharing amongst their team.


This might seem like a strange skill for you to look out for in your candidates. But it’s actually a very important one. During this time of mammoth change in your organisation, there will understandably be some people who don’t make the cut. This can cause an unavoidable and understandable downturn in your employee’s morale as anxiety over what they are going to do next rises.

In many cases, the employees who aren’t kept on don’t leave the merged organisation straight away. This is why it’s so important for the candidates that you do decide to keep on have empathy. It’s highly likely that the employees you keep and those you choose to leave will be exposed to each other which can sometimes create an awkward and upsetting situation for both parties. The last thing you want is to exacerbate the situation further by keeping hold of candidates who are insensitive and unsympathetic towards those who have lost their jobs.

As bricks and mortar stores try to stay afloat amidst growing competition from online retailers, mergers and acquisitions can seem like a shining light of hope in the darkness. It’s not surprising that more retailers across all sectors are expected to try merging in a bid to prevent closures. So, it should give you some comfort that you aren’t the only one who is going to have to make some hard-hitting decisions about which employees you think should stay on board.

Differentiating between candidates is no easy task, but if you want to retain the best possible talent after a merger, it’s something you simply cannot avoid. You might find that it comes down to one minor thing that sets one candidate apart from another. This is why it’s so crucial to consider that human factor and not just rely on the job-related skills and experience written on a CV.

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Helen Ives

18th May

Industry Insight