From never ending competition, to frequent Amazon policy changes—and everything in between—the list of incentives motivating FBA sellers to exit is never in short supply. As sellers increasingly look to aggregators as both a solution and source of opportunity, aggregators are simultaneously looking back at FBA brands to find out if the interest is mutual. More often than not, this often leaves FBA sellers wondering: What exactly are aggregators looking for in the first place?
While each reputable aggregator takes a slightly different approach in their acquisition process, the more knowledge sellers are equipped with will undoubtedly translate into better positioning for their brands as they approach the negotiating table. The following list aims to compile six unique factors—that while might not make or break an acquisition offer—might catch the eye of a well-seasoned aggregator.
1) Financials
Undoubtedly, any credible Amazon aggregator will be looking at your financials. However, there's no need to panic, and no cause for alarm. With nearly 90 Amazon operators in the space today, each organization will prioritize varying indicators such as: ability to turn a quick profit, year after year growth, or general growth trends over time.
2) Category
Similarly to sellers, some Amazon aggregators operate with a category agnostic approach, while others focus strictly on acquiring brands within specific domains. This strategy extends further into seasonal and fad products, which catch the attention of some aggregators, while failing to grab the interest of others. Understanding the focus areas and expertise of each operator can help sellers understand which aggregators might not only be interested in their brand, but best equipped to potentially absorb their operation.
3) Product
Can your products be easily varied? Is your existing brand prime for new product launches? Does your product require advanced technical know-how to produce? All of these factors pose great points of conversation during initial discovery calls with aggregators. Discussing these specific opportunities has the potential to catch the interest of operators, while also illuminating which aggregators maintain the know-how to take your brand to the next level.
4) Expansion
When evaluating your brand, operators might be interested to see if your product(s) are omnichannel friendly, compatible with brick and mortar settings, or desirable within a global e-commerce context. While these factors will depend on the operator's post-acquisition strategy, they’re nonetheless important to keep in mind.
5) Buying Trends
In addition to general growth trends and profitability timelines, it’s worth examining the buying trends of your customers. Does your brand boast a significant percentage of return buyers? How do you track your customer loyalty? While it is difficult to calculate this precisely due to Amazon’s own data ownership, it's worthwhile to note if your brand is positioned for “subscribe and save” or general re-ordering behavior.
6) Existing Relationships
While it can’t be stressed enough, each Amazon operator will be looking for slightly different qualities tied to your brand. Having an open conversation with aggregators will provide you with the best insight into 1) How to position your brand, and 2) Clarity relating to which operator is best suited to achieve your specific goals. The last points worth discussing with prospective aggregators are the relationships and individuals tied to your brand, in addition to your objectives for managing these relations post-acquisition.
Some operators might look to hire business owners post-acquisition as they aggregate both talent and brands. Other operators might already have a complete and experienced staff, and prefer not to maintain talent following the acquisition. Operators might also be curious to see if your brand boasts a robust staff, or is skillfully managed with a one or two person team.
Secondly, it’s worth providing an overview of your existing supplier relations. Do you maintain strong and reliable suppliers, or are you looking for an operator with extensive relationships that can override any logistical challenges you have been experiencing? Either way, there’s an operator out there best suited for you.
