Chris Shipferling and Paul Miller have been working in the Amazon FBA and eCommerce space for years now. They recently took time to share their unique perspectives regarding the market, what buyers value vs. what sellers value, and the different atmospheres and priorities presented in Prosper 2022.
Comparing and Contrasting the Prosper Shows
Because Chris and Paul are regular attendees at the Prosper Show, they were able to evaluate Prosper 2022 and compare it with Prosper 2021. Here are a few differences they both noticed:
1. There was a healthy mix of buyers, sellers, and service providers at Prosper 2022. However, there were fewer brand owners than one would hope. It appeared that approximately 50% of attendees were sellers, and when Chris reached out to his connections before the show, about 90% of them told him they wouldn’t be attending the show. This indicates that there is certainly room for the show to improve in value.
2. Even though some aggregators have paused acquisitions, there was still a bullish atmosphere about where eCommerce is headed.
3. While in 2021 it seemed that aggregators and aggregator events dominated the Prosper Show, the 2022 Prosper Show saw more service providers showcasing their services to improve seller businesses – rather than more people trying to commoditize FBA brands.
4. We did see many new intermediaries at Prosper 2022. While the burgeoning intermediary businesses are a natural evolution in the space, Chris predicts that most aggregators will want to work with seasoned brokers and intermediaries with an in-depth knowledge of the space.
Overall, the 2022 Prosper Show was more heavily attended than 2021, which likely speaks to the country opening up more this year. It also shows that, while we’ve all faced challenges over the last year, attendees see a bright future in eCommerce.
Aggregators are slowing down and even pausing acquisitions. There are several reasons for this move including:
– Unwillingness to make direct acquisitions and spend the time and money researching a brand – only to discover that it’s a bad fit for the aggregator. A large aggregator reached out during the show to tell Chris that they are only interested in working with professional intermediaries who understand the industry and the ins and outs of what that aggregator is looking for. So, while some aggregators are not completely pausing acquisitions, several are hoping to spend less time and energy on acquisitions and more capital on operating their existing brands.
– They are taking stock of their current brand inventory. Once an aggregator buys a brand, the brand doesn’t run itself. They must put in the time, attention, and capital to make sure brands remain successful. This has proved a challenge in the past year with inflation, shipping delays, continuing lockdowns, and more.
– They are mitigating losses on bad deals by reinforcing successful brands. Any aggregator will likely have made a certain percentage of bad deals, and they are taking a step back, reviewing operations, and narrowing their focus to ensure profitability.
These are the main reasons behind aggregators pausing or stepping back on purchases. This sentiment is coupled with reasonable seller sentiment, shared below.
Many brand owners are jaded after all of the outreach and spam they’ve received over the past year. The message from aggregators has become diluted. Many sellers have either already reached out to an aggregator and been rejected or decided to put the messaging on mute while working on their brand.
Paul and Chris had many conversations with sellers about how they could improve their brands and the best strategies for planning an exit anywhere from three to nine months down the road.
Business owners discussed product roadmaps, innovation, new markets, hiring best practices, standard operating procedures, PPC challenges, and new ways to drive revenue. These business growth strategies will help dedicated brand owners scale their businesses, turning their brand into a better profit driver. Not only will that shift in focus set the business owner up for an amazing exit, but it will also benefit the owner and their team immediately as the company scales and grows.
Are you dedicated to growing your brand to make an amazing exit one day? Schedule a free exit strategy consultation here.