eCommerce Mergers and Acquisitions: Consulting and Due Diligence:
Learn how eCommerce Mergers and Acquisitions services work and how Optimum7 does eCommerce due diligence by downloading our M&A Checklist for Shopify, Bigcommerce, Enterprise, and Magento.
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eCommerce Mergers and acquisitions are strategies to gain a higher market share and reduce those from competing firms. Corporation giants have engaged in acquiring businesses or merging with rivals to achieve this goal. eCommerce companies can do the same, with smaller economies of scale.
The most recent example of such an acquisition — as of January 2021– is Staples offering to purchase Office Depot. According to DigitalCommerce360, Staples offered $40 per share on Office Depot, valuing the whole company at $2.1 billion. Both corporations retail office supplies, usually at brick-and-mortar locations. With the pandemic shutting down nonessential businesses, office supply retailers see less revenue.
Even though Office Depot rejected the offer, they are open to merging companies. Staples is number 8 on the 2020 Digital Commerce 360 Top 1000 companies. It is facing competition from online retailers that can deliver the same supplies with two-day shipping. Such shipping also promotes health safety for the consumer.
Many corporations such as Amazon and Wayfair have taken this route, acquiring brands or developing them to sell various products. Becoming a general retailer means that you will fail against the corporate giants. They have a larger economy of scale to purchase brands from different sectors and appeal to multiple customers. Therefore, smaller eCommerce businesses need to take a more specialized approach, choosing a particular industry.
We have a detailed eCommerce M&A (Mergers and Acquisitions” Checklist. Contact us and we will send you this Checklist or help you with your eCommerce M&A Process.
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