Selling Amazon brands and getting data for free may be a mistake for sellers

After a whole year of preparation and development last year, many sellers have now recognized the acquisition of Amazon brands/stores by aggregators , and as time goes by, more and more sellers are interested in selling their brands/stores to aggregators. But last year was just the beginning, and many aggregators were also in the learning stage, and the number of acquisitions was also reserved, so we saw that the total number of brands/stores acquired in the market was not large.

The acquisition market continues to develop this year. With more and more aggregators entering the market, there are now nearly 100 active aggregators in the market . At the same time, after learning last year, many aggregators have explored a set of experiences that suit them and expressed their intention to expand the number of acquisitions this year. Relevant data shows that in 2022, it is expected that 1,000 Amazon brands/stores will be successfully acquired. In addition, some formats that assist sellers in selling stores are also taking shape, such as brokerage companies (intermediaries).

92 aggregators are active and 1,000 brands will be acquired this year

Have you ever experienced this kind of thing: just when you are worried about the ever-increasing shipping costs, and the inventory will soon be sold out, and the money for stocking is still not settled, and you are in a panic, another familiar seller who is in a similar situation to you is leisurely sunbathing in Sanya. Upon asking, you find out that he has sold the brand to an aggregator.

By selling the brand in hand, sellers can obtain the brand's profits for the next 3 to 5 years in one go , without having to worry about rising shipping costs and increasing financial pressure, or bear future risks. Taking the money and leaving has become the choice of more and more sellers.

And now aggregators are fully prepared for this option for sellers.

According to the latest data from Marketplace Pulse, Amazon brand aggregators have raised nearly $15 billion in financing. There are currently 92 active aggregators in the market, 53 of which have announced the completion of several rounds of financing, and 32 of which have raised at least $100 million. In the early days, most of these aggregators were concentrated in the United States, the United Kingdom, France, Germany and other European and American countries. Now, aggregators are also operating in Japan, South Korea, India, the United Arab Emirates, and Israel.

At the end of last year, The Fortia Group (an Irish company focused on acquiring and developing European e-commerce brands) launched a sample survey of 38 aggregators. According to the Fortia Group's survey, 25% of aggregators said they expect to complete 40 to 49 transactions in 2022. 20% expect to complete 20 to 29 transactions in 2022, and only 10% expect to complete less than 5 transactions. Emmett Kilduff, CEO of Fortia Group, said that "Amazon sellers may sell 1,000 FBA brands next year."

With the help of a large amount of capital, aggregators will also be more aggressive. A sample survey of 42 aggregators by Fortunet (an investment banking firm specializing in M&A transactions for high-end e-commerce businesses and Amazon FBA businesses) showed that 53% said they had no upper limit on the amount they would spend on the brands they wanted to acquire, while 25% said that $10 million was the upper limit they could spend.

However, as the Amazon brand acquisition market develops, sellers are also facing some problems, such as who is the best aggregator to sell to when there are so many aggregators; how to ensure the data security of brands/stores during the acquisition process, etc. At this time, Amazon brand acquisition brokerage companies (intermediaries) came into being.

With the help of brokerage companies, brand sales are smoother

There are currently two main ways for Amazon sellers to sell their brands /stores to aggregators: 1. Selling directly to aggregators; 2. Selling through Amazon brand acquisition agencies.

We have learned that more transactions in the market are currently completed through brokerage companies. This is because there are some problems for sellers to connect with aggregators themselves:

First, poor language communication . Most aggregators are from Europe and the United States, and many sellers lack the ability to communicate in English and other foreign languages, which may eventually lead to transaction failure or prolonged transaction time.

Second , if you don’t understand the true value of your store, you may sell it at a low price.

Third , if you are not clear about the relevant legal provisions, you may fall into traps in the transaction contract;

Fourth , lack of understanding of the Amazon brand /store trading market makes it difficult to realize what the normal terms and rules are;

Fifth , the security of the account during the transaction is difficult to guarantee, and there is a risk of obtaining data for free.

Compared with individuals, brokerage companies are professional teams, so they have the following advantages in the docking process:

First, we have lawyers, translators and other professionals who can provide sellers with full translation, assist sellers in preparing materials, write brand introductions and other full-time nanny services . At the same time, we can also help sellers avoid contract traps and provide legal protection, etc.

Second , we have cooperation with many aggregators in the market, which can help sellers select the acquirer with the highest bid, the greatest potential and the most likely to succeed in the transaction;

Third , they have a certain understanding of the strength and background of mainstream aggregators in the market, and can quickly determine whether the buyer is reliable or whether there is a possibility of cooperation;

1. Fourth , we have professionals in finance, taxation, etc. who can provide sellers with corresponding financial and taxation services and help sellers avoid tax risks to the greatest extent.

But now, as the Amazon brand /store acquisition market is heating up, many brokerage companies are rushing into the industry, trying to match sellers with aggregators for transactions. However, in this process, some non-professional individuals have also entered the industry, which has led to the uneven quality of brokerage companies. Who should sellers trust and choose?

Assisting sellers to sell their brands, Anci has strong strength and advantages

The editor learned that Ciheng Consulting, a subsidiary of Anci Capital, has strong strength and advantages in assisting Amazon sellers to sell their brands /stores.

It is reported that Anci Capital and the Ciheng team have been deeply engaged in cross-border e-commerce capital services for more than eight years. They have been invited by CCTV to express their views on industry mergers and acquisitions, and have also led the investment or M&A listing projects of many well-known cross-border e-commerce related companies such as Paton, Tongtuo, Santai, Yibai Network, Starlink, Feishu Shenno, and 4 Kmiles. The Ciheng team has completed several Amazon store transaction cases and is providing professional services for many small and medium-sized Amazon sellers to sell their stores.

Currently, Ciheng Consulting is handling transactions for many stores and maintaining close cooperative relationships with more than 60 or 70 acquirers on the market. As a professional service agency, Ciheng Consulting promises to provide the following services to high-quality Amazon sellers:

1. It is not just information matching. We always stand on the seller's side and are determined to find the most suitable buyers for high-quality sellers.

2. Assist in collecting and judging offers and assessing the strength of buyers;

3. Efficiently promote and control the due diligence process;

4. Assist in drafting transaction documents and negotiate with the acquirer on behalf of the seller, so as to maximize the interests of the seller and control transaction risks;

5. Assist in isolating potential risks of store transfer from the perspective of transaction terms and transaction arrangements;

6. Assist the seller in handling other issues related to the sale of the store and respond to the seller's questions or concerns at any time.

If you also want to find such an agency with outstanding strength and advantages, please scan the QR code below and contact Ciheng Consulting Customer Service!

Acquisition of Amazon Brands

Amazon Brand Aggregator