The landscape of mergers and acquisitions (M&A) experienced a downturn across Europe in 2023, according to the Deloitte Report. Yet Bulgaria is one of the countries remaining stable to this trend.
Meanwhile, in the ever-evolving world of e-commerce, the dynamics of the market require shifting strategies to meet the customers’ demands. M&A can be a way to gain competitive advantages and create value in the region, by leveraging synergies and focusing on accelerating growth, international expansion, and competitiveness.
In our neck of the woods, Bulgarian euShipments.com, a company offering an extensive array of services tailored for regional e-commerce exporters, stands out as embracing this approach. euShipments.com adopts a strategy of acquiring local businesses that align with their vision which facilitates their rapid expansion. It enables the company to broaden its logistical footprint across key European markets.
Founded by Svetlozar Dimitrov (CEO) and Lora Dimitrova (Managing Partner) and headquartered in Ruse, Bulgaria, the company boasts an e-commerce logistics IT platform seamlessly integrated with its customers. This platform facilitates real-time access to a comprehensive suite of services, including warehousing, e-fulfillment, courier services, cash on delivery options, round-the-clock support from a single contact person, and a local address in each country for processing returns and managing undelivered and canceled shipments.
During the Balkan eCommerce Summit, we had the opportunity to meet Vichren Bisset, Chief Commercial Officer and Board Member at euShipments, who shared more on their approach to regional acquisitions and synergy merges.
Foundation for Growth
euShipments was launched 12 years ago in Bulgaria, initially confined to the Bulgarian and Romanian markets.
“But then our clients decided that they would like to expand their regional reach – Greece, Romania, Croatia,” says Vichren. “It is because you cannot grow endlessly, the market is limited.”
Led by their clients’ needs, in 2012/2013 euShipments opened a fulfillment center in Russe. “It was an amazing success as all the processing orders, packaging, sorting, etc. were transferred there.” The optimization showcases that cultivating strong ties within the local ecosystem is a crucial part for fostering mutually beneficial partnerships. It not only facilitated clients’ demands for diversified logistical infrastructure but also laid the groundwork for a strategic shift towards acquisitions.
“We saw a great possibility to grow naturally through acquiring companies in strategic locations because it is very difficult to start from scratch if you don’t have a local partner,” he added.
Strategic Evolution
Recognizing the potential synergies aligning with companies sharing similar business models, Vichren briefly mapped their journey over the four years, adding four regional companies to their portfolio.
“It is a win-win situation. We share our know-how with the companies we acquire, while they contribute to our reach and expansion to new territories. As we invest in them, they manage to grow faster and become leaders in their markets.”
Regarding the due diligences, he shared that the process “ticks” all the standardized procedures. But the emphasis is placed on the synergies, hand in hand with evaluating the local talent and their industry expertise. “Good connection to the local ecosystem is essential, so they can contribute to the partnership,” explains Bisset.
Logistical Leverage
Vichren sheds light on their recent acquisition of the Slovak Swiss Point Data, the forth one in their portfolio, with two key points for the deal.
“First, it is an established company, with more than 20 years of history. They have a team with strong knowledge in the sector which is crucial. They almost don’t need our support for structuring the company,” he explains. “And then, it is about connectivity and infrastructure. Bratislava has a strategic location which would benefit our network.”
Vichren further clarified that peripheral European geographies, like Bulgaria and Romania, could be enhanced through the logistic network.
Venturing Forward: Collaboration with BlackPeack Capital
euShipments.com has partnered with the Bulgarian private equity fund BlackPeak Capital since the beginning of their M&A journey.
Vichren explains that “it underscores a shared vision for growth and innovation with embracing a ‘buy and build’ strategy”. He further clarifies that their expertise is an essential part of their collaboration, as BlackPeack is part of their strategic planning.
As for BlackPeak, previously shared for The Recursive, their backing is part of their strategy to invest in niche industry leaders in high-growth industries.
Market Dynamics and Future Outlook
Despite their current M&A growth strategy, the company will now shift their focus towards structural enhancements, IT optimization and service augmentation.
“Now it is time to structure,” shared Vichren. “After years of rapid growth, it is time to utilize what we have acquired into improving our services.”
Bisset envisions streamlined operations and better service efficiency, poised to meet the consumer demands. Moreover, they will aim to strengthen their presence in existing markets rather than expanding into new territories.
“At the moment, we are focused on introducing bigger players in our markets.”
Vichren explays that as giants such as Amazon and AliExpress tailor their approaches to suit local markets, forming partnerships with agile local businesses becomes increasingly vital for achieving success.
