Amazon Aggregator and Active Trading Markets
sinceSince the beginning of 2021, Amazon store transactions have entered a relatively active period. According to incomplete statistics, there have been 60 to 70 Amazon Aggregators in the market that mainly focus on acquiring Amazon stores, of which nearly 10 have established offices or recruited Chinese agents in China, and a list of 1000 target stores is circulating on the market, These 1000 stores are considered ideal brand acquisition targets, and many sellers may have received emails or other communication requests from some buyers or even agents in the near future. Many seller friends may have heard that a seller friend nearby has made a big profit through store sales, and even some seller friends who have already completed store sales may further exclaim "selling cheaply" after learning about the current market situation, The emergence of such a bustling scene can be roughly attributed to the following reasons:
1The seller's suspension of registration increases operational risk. Starting from this yearStarting from May, a large number of popular brand stores were closed down, involving multiple well-known top sellers in South China. Amazon's ban policy has to some extent undermined the confidence of some sellers in their continued operations, leading them to choose to sell their brands and cash out.
2The surge in logistics costs has increased operational costs. The recent price increase for sea freight is indeed significant. The price is rising with the market, and the shipping space is really tight, making it difficult to book, especially in recent times when many sellers are preparing for peak season goods. Along with the increase in shipping costs, the shipping company also incurs peak season surcharges, which undoubtedly further increases seller costs. In addition, the impact of the epidemic has also posed certain challenges to sellers' stocking and operational capabilities due to shipping delays. Some sellers may choose to stop stocking up in large quantities in the second half of the year and prepare to sell their brands at such an opportunity.
3Brand accelerator companies have entered China on a large scale. As mentioned earlier, some buyers have vigorously expanded their presence in the Chinese market, hiring Chinese staff for Chinese sellers, and even providing universal policies. As long as the recommended store successfully completes the transaction, they will provideWith a reward of 5-10w US dollars, many intermediaries or individuals engaged in matchmaking transactions have emerged on the market, directly promoting the prosperity of the Amazon store trading market.
Store transaction price
At present, the general price for store buyers is calculated as follows:
Project valuation =Total gross profit for the past 12 months × Valuation multiples.
Valuation multiples inBetween 3-5 times, the main reference factors include: growth rate of revenue and gross profit, product lifecycle and product fortress, and brand fan base.
Portraits of saleable stores
Generally speaking, acquirers prefer stores with the following characteristics:
Behind the frenzyPit
Under the stimulation of the above factors, the store trading market has also shown considerable activity. During peak periods, the Ciheng team needs to communicate within a weekMore than 50 sellers, but under the current frenzy, the number of stores that have successfully completed transactions is not as large as expected, and some transactions have even experienced some delays and iterations. Store transactions are not simply buying and selling. Transactions involve the cross-border flow of funds and assets. Based on actual cases, the Ciheng team summarized the "pitfalls" behind store transactions:
1Who should intermediaries and buyers around the world trust? As mentioned earlier, driven by buyer commissions, people have flocked to this industry in an attempt to match up people around them for store transactions. However, the quality of intermediary agencies varies, and even some non professional individuals have joined the industry. For sellers, facing unfamiliar buyers or intermediaries with insufficient abilities cannot generate complete trust, especially some non professional intermediary individuals, In order to match transactions, it is possible to spread seller information around the world, which may lead to information leakage and attract the attention of competitors; After completing the preliminary matchmaking, if one is unclear about the subsequent procedures or blindly promotes the process from the buyer's perspective, the above situations undoubtedly increase the seller's trust cost, and thus dare not rush to promote store transactions;
2DifferentHow to choose between offers? After successfully reaching out to real buyers, high-quality stores may attract the interest of multiple buyers. Faced with multiple offers, how should buyers choose, in addition to comparing valuations and analyzing transaction conditions? More importantly, what is the buyer's background and do they have the ability to make subsequent payments?
3Why is the progress of due diligence repeatedly delayed? Compared to the initial exploration of the store transaction process, the efficiency of the due diligence process has greatly improved. However, compared to many sellers' expectations of completing sales before the peak season in the second half of the year, not all buyers can match a responsive due diligence team, especially since most buyers' due diligence teams are still overseas, and the logic of different buyers' acquisitions varies, Some pay attention to the sorting of the supply chain, some are more concerned about product selection strategies, and some are more concerned about product advertising strategies. Different buyers have different emphasis on due diligence. If communication between the two parties is not smooth, it can also lead to a delay in the due diligence deadline.
4How to understand the complex arrangement of phased payments? At present, there are almost no store transactions on the market that can achieve one-time payment, and even some buyers' first payment ratio is only50%, but is it really better to have a higher payment ratio for the first installment? Is the payment arrangement that is still linked to net profit growth rate reasonable even when the original seller is no longer responsible for operation? The design of these professional terms may also plague sellers and to some extent hinder the smooth progress of transactions.
5Is it really possible to complete store transfer without risk? This is an important issue for sellers. The most perfect outcome is the smooth transfer of the store and the successful completion of the transaction. However, Amazon does not explicitly allow direct changes to the store's backend entity. Sellers are even more concerned that unauthorized changes to the backend store entity may lead toKYC review found that the inability to complete a transaction is a small matter, and further irreversible damage to the store itself is significant. However, almost all buyers in the market have adopted a secretive attitude towards this issue. Some experienced buyers will simply inform first-time sellers that they have official communication channels and have completed changes in historical cases. However, according to our understanding, the facts may be more complex, Some cases directly received inquiries from Amazon during the transaction process, which affected the progress of the transaction.
Giheng Team
How to choose high-quality transaction intermediaries?Based on the above, we believe that in the current market with obvious buyer advantages, the existence of seller intermediaries is quite necessary. High quality intermediaries play a crucial role in improving transaction prices and efficiency. We believe that an excellent intermediary team has the following characteristics:
1There have been successful transaction cases and successfully completed store transactions in history.
2Rich buyer resources, familiar with the financial strength and preferences of each buyer, able to accurately connect.
3We have a professional team equipped with professionals such as lawyers and accountants with cross-border experience.
4Having rich industry experience and understanding the industry characteristics of cross-border e-commerce, one can quickly and accurately judge the quality of stores.
We areCiheng Consulting（WeChat:CICHENG-GZ）It is a professional consulting agency under Anchi Capital that focuses on cross-border e-commerce capital services. Anci Capital and the Ciheng team have led investment or mergers and acquisitions projects for several well-known cross-border e-commerce related enterprises, including Patoson, Tongtuo, Sanxing, Yibai Network, Starlink, and Feishu Shennuo. The Ciheng team is providing professional services for multiple small and medium-sized Amazon sellers to sell their stores.
At present, we are handling transactions with multiple stores and maintaining close cooperative relationships with 60 to 70 acquirers on the market. As a professional service organization, we promise to provide the following services to high-quality Amazon sellers:
oneWe do more than just information matching. We always stand on the seller's side and aspire to find the most suitable buyer for high-quality sellers;
twoAssist in collecting and judgingOffer to evaluate the buyer's strength;
threeEfficiently promote and control the due diligence process;
fourAssist in drafting transaction documents and represent you in negotiations with the acquiring party, in order to strive for your maximum interests and control transaction risks;
fiveAssist in isolating potential risks of store transfer from transaction terms and arrangements;
sixAssist you in handling other issues related to selling the store and respond to your questions or inquiries at any time.
Choose us as your agent for selling your store, and we will help you avoid various transactions in the storePit "helps you efficiently, safely, and smoothly complete Amazon store transactions.
You provide a high-quality store, and we guarantee the entire transaction process for your store.
