Nearly half of large retailers are considering selling their stores?

Nearly half of large retailers are considering selling their stores?

According to a survey of Amazon's third-party sellers by a consulting firm, nearly half of Amazon's medium and large third-party sellers intend to sell their businesses.

 

The survey was conducted by consulting firm ecommerce aggregators and surveyed a large number of Amazon third-party sellers with annual sales of more than $1 million.

 

The survey showed that almost half ( 49% ) of respondents have begun preparing to sell their Amazon businesses. Meanwhile, 43% of respondents have engaged with consulting firms or Amazon aggregators since the beginning of 2022 .

 

The past 18 months have been extremely challenging for third-party sellers on Amazon due to supply chain and pandemic issues,” said Richard , co-founder of ecommerce aggregators   "As the Amazon platform enters a period of rapid consolidation, our research shows that sellers are more willing than ever to sell their businesses , " Turnbull said.

 

As many as 87% of respondents prefer to sell their stores to Amazon aggregators , citing higher valuations ( 64% ) and a faster process ( 55% ) than through traditional business broker channels .

 

Ecommerce aggregators say that, as a rough estimate, Amazon aggregators typically value businesses with profits between $100,000 and $800,000 at four times profit. For businesses with profits between $800,000 and $1.5 million, aggregators value them at four to six times profit. For businesses with profits between $1.5 million and $5 million, aggregators value them at six to eight times profit.

 

According to statistics from ecommerce aggregators, there are currently about 150 Amazon aggregators around the world. Most aggregators have requirements for acquired stores: a minimum average gross margin of 20% and sales of $500,000. At the same time, aggregators prefer stores with stable sales, and so-called "hot-selling" stores are not popular with aggregators.

 

“Amazon Aggregators offer sellers a quick exit from their business, with the entire process typically taking less than 60 days if revenue and margins are in place . Aggregators have offered some incredible valuations since the beginning of the year . ” Richard   Turnbull said.

Aggregators

Amazon

Seller

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