With 3,700 products sold through 100 different channels in 28 countries and over $350 million in sales last year, Berlin Brands Group (aka BBG) may be the biggest D2C eCommerce player you’ve never heard of.
But this 15-year-old German brand incubator is looking to change that, and has come to America with $240 million in fresh capital in search of successful Amazon sellers that it can acquire and scale under a proven system of success.
“While Amazon certainly tops the list of most-visited online stores in the U.K., Ireland, Germany and France, it doesn’t even make it into the top five for booming eCommerce countries like the Netherlands, Denmark and Sweden,” BBG Founder and CEO Peter Chaljawski said in an email Q&A with PYMNTS.
Amazon may dominate the US eCommerce sector, but Chaljawski said it has a market share of just 10 percent in Europe. “All across Europe, we can see a strong eCommerce presence, but as a platform, Amazon doesn’t necessarily play a major role in every country,” he said. “BOL, for example, is the leading eCommerce platform in the Netherlands and Belgium, with more than 11 million active customers, [which just] shows us how valuable it is to utilize various eCommerce platforms to reach new consumers all over the globe.”
The Scaling Machine
With 900 employees and its own logistics centers in Western and Eastern Europe, Asia and the U.S., Chaljawski said BBG has the proven expertise, data and capabilities needed to quickly and aggressively scale brands worldwide.
“The integration of each acquired eCommerce brand into the BBG platform involves a highly automated process, including content creation and [language] translations, price adjustments and real-time updates on more than 100 selling channels,” Chaljawski said.
But it’s not just BBG’s formulaic acquisition and integration process that drives its success. Chaljawksi said his company also has a set of intangible skills that it deploys from start to finish in every deal. “Without data, you go nowhere in this business. But apart from that, there is something you can’t pull from market data,” he said, adding that BBG has a certain “set of manufacturing and engineering expertise that we use to evaluate products and expand portfolios by launching new products” that it has used for more than a decade.
Opening the Doors to Europe and Beyond
The Amazon aggregator niche is not without competition, as scores of well-funded firms scour the “top sellers” list every day in search of the next big thing, while courting business owners and entrepreneurs who might be ready to cash out.
Even so, Chaljawski said BBG has the power — and the money in hand — that U.S.-based brands need to “open the doors to the European market” and take advantage of a fast-growing but complicated part of the world to do business, involving language, currency, regulatory or cultural differences.
That said, the BBG chief pointed out that the typical target company is already doing between $1 million and $100 million in sales within the home and garden, electronics, sporting goods and music equipment categories.
“This initial investment is intended to further support the acquisition of online retail brands in the U.S. and to integrate them into BBG’s global scaling platform,” Chaljawski said. “Only through this variety of channels is it possible for brands to be successful in a fragmented market like Europe.”
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