I have been part of the window covering industry for many years. The largest company in the window covering world is Hunter Douglas. Hunter's sales in 2021 were 4.6 Billion. They have purchased a wide variety of related companies for one of a few reasons.
1- Taking over a customer base an increasing distribution.
2- Proprietary products or technology
3- An off shoot of 1. Buying your competitor means less competition while at the same time bringing in the purchased companies revenue. It is likely PSA can run the company with the same or similar staff on the corporate side increasing profitability.
Hunter has let some companies continue under their own banner. Typically, its business as usual for the 1st year or so. Over time the original company disappears and becomes Hunter sometimes with the original companies name, sometimes not
Because SGC has a large and loyal customer base and is true competition for PSA , it made sense for PSA to take them over. Clearly, they did not buy SGC for #2 (proprietary products or technology) or a handful of graders.
While not a perfect analogy PSA took out their toughest competition and will now be SGC as well for as long as it suits them. I also believe (and hope) that SGC graded cards should hold up at least on vintage as they are well respected
|