So, you’ve developed a successful e-commerce business and you’re looking to transform it into a global brand. But where to start?
Selling a business is one highly effective option for getting your company to the next level. But for many this can be a heart-wrenching decision. Most founders have poured their hearts, souls, and savings into their businesses and are understandably anxious about taking this next step.
If that sounds like you, choosing an option where you can still be involved in the day-to-day operations could be sensible. At BRANDED, we encourage our founders to stay onboard, working on areas of the business they love and helping us retain the best of the brand. We structure our deals to prioritize the continued success of the original brand and ensure the highest earnout for the founders.
Of course, one of your priorities is likely to maximize your valuation. To do this you’ll need to make sure your business is well set up for going to market and that you’re selling at the most sensible point in time.
So, if you’re asking yourself, ‘how can I accelerate my business’ growth before selling my business?’, here are some of our top tips.
Get the Right People on Board to Help with Business Growth
It is really important that you present yourself as a true expert of your business and your market to your potential buyer. This will increase the chances of the transaction happening and expedite your company’s future growth.
Whether this means outsourcing your marketing or hiring an expert to help your with the struggling bit of your business, it’s worth investing into the expertise that you need in order to present your company as a truly professional organization. Fixing any big outstanding business issues before going to market will increase your chances of success and your valuation.
Once you’ve done that, remember that it’s a two-way process when you’re looking for your company’s new custodian – you should also be evaluating their capabilities to make sure they have the right expertise and resources to help your company scale. We wrote down some questions sellers should be asking buyers as they make their decision.
At BRANDED we have specialists in our team across a range of areas, including social, supply chain, SEO, and legal, to plug any gaps you may have. Our team has previously scaled companies to achieve record year-on-year growth, beyond what their founders could have imagined. Check out some early results we achieved for our brands here.
Working with a team with broader expertise can be especially important in situations where you have grown into new markets or channels that are less familiar, as this may mean you are subject to compliance regulations you might not be aware of.
BRANDED proactively looks closely at all the elements involved in ensuring our brands and products meet such regulations. We keep on top of the latest changes from Amazon and our expert legal team works tirelessly to stay ahead of the game so you can thrive and continue to work on the success of the business.
Look at Your Supply Chain when Selling a Business
Supply chain issues often hit the headlines for the wrong reasons. In the news just this month, we’ve seen Rolls-Royce blaming them for an epic £111m loss.
This is certainly a motivator for taking a good look at your own business operations to avoid future problems, which can have catastrophic impact on your business. For some customers, it will only take the disappointment of something being out of stock once for them to shift loyalties and shop elsewhere – permanently.
But Looking at your supply chain is about more than just preventing future fires. If you want to ensure the highest possible valuation when you sell, a good first place to start is by optimizing your supply chain. Making improvements here can massively enhance your ability to scale, as well as boosting the value of your brand.
At BRANDED when we start working with a new customer, we take a thorough look at centralized logistics management, sourcing and manufacturing, and packaging improvement to optimize your supply chain functioning.
For example, for Puracy, one of our portfolio companies, we provided resources, expertise, and capital that helped them minimize operational expenses, negotiate better costs and rates, and spend more time on more visionary activities like product development, brand building, and customer acquisition.
Don’t Neglect Social
It’s official. 90% of corporations agree that the impact of social media on businesses, both positive and negative, is immense.
This is certainly something we have seen to be true for the companies we work with. For one of our brands, OTOTO, TikTok has proven to be a crucial and influential platform for promoting its whimsical household items to an engaged audience. Items such as the Al Dente Spaghetti Tester and Red the Crab Spoon Holder gained millions of views, going viral with keen shoppers, and attested to the power of social shopping to drive views to actual purchases.
For a potential buyer, this is an area you can utilise effectively and will help position you as an attractive prospect. But if it’s not something you’ve managed to master, it could be off-putting.
One mistake some brands make is having a strong following and engagement on some of the more traditional, well-established platforms such as Facebook, whilst neglecting new(er) kids on the block like TikTok.
For some brands, platforms such as TikTok won’t be relevant. But if you have a younger audience and you aren’t using the platform then you could be missing out. Research shows users are spending 25.7 hours monthly on there, a time difference of 9.7 hours when compared to Facebook. The brands not taking advantage of this are missing out on a highly engaged audience.
At BRANDED, before acquiring a business, we look at their social content creation and social channel strategy, as well as more general branding and positioning, to build growth plans.
Consider Expanding Your Amazon Store Globally or Move to DTC
It can seem like there’s an insurmountable wall of questions and misinformation when you’re starting to think about taking your brand global or moving off Amazon to DTC.
However, it is possible. At BRANDED, we are experts in rapidly scaling e-commerce businesses into global powerhouse brands.
For our brand Leaflife, a sustainable bamboo thermos that brews tea on the go, our team experts accelerated their plans to go global and helped them successfully enter the UK and Germany (the 2nd and 3rd largest Amazon marketplaces), navigating complex VAT compliance with ease.
Before doing this though it’s worth doing your research. Making the shift from one English speaking country to another may seem like a straightforward process but don’t be complacent. If your keyword says you’re selling a stroller, you’ll never reach UK audiences who will be searching for a ‘pushchair’ or ‘pram’.
And it’s always worth having an eye to the detail when it comes to things like local regulations, trends, and warehousing costs. Doing your homework here will make a huge difference to your success either way. Read more of our tips on how to go global here.
Finally, Timing is Everything
Forbes estimates that as much as 90% of potential business sale transactions fail.
Given that the process can be incredibly stressful and time-consuming for founders, it’s worth founders making sure they are going to market at the right time to avoid becoming another statistic.
Size wise, we normally take on businesses when they are 7 figures and on the cusp of getting to that coveted 8-figure mark. But there are other things you may wish to consider.
You’ll be in a much better place to negotiate if your company is still experiencing growth, which is where all the points above come in. There will also be sweet spots where your sector is performing particularly well that could be a good moment to put yourselves on the market. However, if business is booming, you’ll also want to make sure that you are able to show a potential to meet that demand.
From an emotional perspective, you may know it’s time to sell if you feel you have taken your business as far as you can with your skillset and are wanting to see it really take off beyond what you’ve been able to do alone.
Or perhaps you’re finding yourself daydreaming about other new ideas you want to pursue and are starting to feel you are ready to move on.
It’s also best to start thinking about a sale when you have some time to give it a bit of headspace. If you have time-critical things happening in the business which are taking up much of your day-to-day you might want to hold on until that busy period has passed.
A big chunk of your energy will need to be available for making improvements to the business to maximise your eventual valuation. The more time you invest in doing diligence on your own business with a sharp eye, the better the eventual pay-out will be.
Our international team of experts have founded, scaled, and sold some of the world’s most beloved e-commerce brands. They can do the same for yours. We have the financial and human capital to accelerate both FBA and DTC businesses with investments of time, technology, and expertise across sourcing, logistics, product development, and marketing. And as an international platform, we understand the different nuances of each market and its consumers.
Speak to BRANDED today and see how we can help you meet all the necessary requirements and grow your business, while staying true to what makes your brand special. Qualified brands will receive a free valuation and tips on how to increase business growth.
