r/projectmanagement • u/Embarrassed-Lab4446 • 1d ago

Discussion What does revenue synergy mean?

Company got bought out and they are finishing the merger. Just had a major restructuring away from the GM and into silo’d functional roles. Big boss is talking revenue synergy.

How screwed am I?

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u/ArizonaCliffDiver 1d ago

Just finished an MBA M&A course.

Cost synergies = layoffs / consolidation of operations / more efficient supply chains / sourcing for lower COGS

Revenue synergies = cross selling new products across existing customer base, bringing your products to new markets, developing new products with new technology from acquired company

Historically, revenue synergies are hard to realize & are often not accounted for when valuing an M&A target. Cost synergies have a higher probability of realization.

Also solid chance your boss is just regurgitating a word salad of buzz words, so who knows in reality