E-Commerce Exit Planning

E-commerce businesses look transferable on paper. Digital operations. Scalable infrastructure. Global reach. No physical locations required. Everything runs through platforms designed for commerce. This should make e-commerce businesses easier to transfer than traditional retail.

Then you try to exit and discover that platform dependency creates its own transferability problems. Amazon can change fees, ranking algorithms, or decide to compete with your best-selling product. Shopify provides infrastructure but doesn't provide customer loyalty. Facebook and Google control your customer acquisition costs and can change them overnight. Your entire business sits on platforms you don't control.

This isn't just theoretical platform risk. It's actual dependency that buyers evaluate and discount. An Amazon FBA business doing $2 million in revenue with 85 percent of sales through Amazon and 15 percent direct to consumer is fundamentally different from a business doing $2 million with 40 percent Amazon, 30 percent Shopify, 20 percent wholesale, 10 percent other channels. Same revenue. Different platform dependency. Different risk. Different value.

The second dependency is supplier relationships. You've spent years finding reliable suppliers, negotiating terms, building relationships that give you advantages competitors don't have. You know which suppliers can handle rush orders, which ones maintain quality consistently, which ones are flexible on minimums, which ones are worth the premium pricing. That relationship knowledge lives in your head or in email threads, not in documented systems.

The third dependency is marketing channel knowledge. You know which Facebook ad audiences actually convert versus which ones just burn budget. You know what creative approaches work for your products. You know which Google Shopping optimizations matter versus which ones are noise. You understand email segmentation and how to drive repeat purchases. You've spent $200,000 learning these lessons through trial and error. A buyer inherits the current campaigns but not the knowledge that created them.

The fourth dependency is inventory management judgment. You know which products to stock deep based on seasonal patterns you've learned over years. You know which SKUs are declining and which ones are growing. You know how much inventory to buy for holiday season based on historical data plus intuition about market trends. Your team can execute inventory orders, but the judgment about what and when to buy comes from you.

E-commerce businesses should be more transferable than traditional retail because digital operations are easier to document and systems are easier to transfer. But in practice, the platform dependency, supplier relationship knowledge, marketing expertise, and inventory judgment create the same transferability gaps that relationship dependency creates in service businesses. The business works fine while you're running it. A buyer looking at it asks whether it will work without you. If your knowledge and relationships are undocumented, the answer is uncertain. Buyers pay for certainty, not hope.

Supplier relationships in e-commerce are valuable but invisible. You've spent years finding reliable suppliers, testing quality, negotiating terms, building relationships. You know which suppliers are worth the premium pricing because quality is consistent. You know which ones can handle rush orders when you're about to stock out during high season. You know which ones are flexible on minimums when you're testing new products.

That knowledge is competitive advantage. Your cost of goods sold is 8 percent lower than competitors because of supplier relationships. Your ability to avoid stockouts is better because suppliers prioritize your orders. Your product quality is more consistent because you've cultivated relationships with manufacturers who care about quality, not just price.

But buyers can't see this knowledge. They see your supplier list and your cost of goods sold. They don't see the relationship history that created those terms. They don't see the knowledge of which suppliers are reliable versus which ones cut corners. They don't see your ability to get better terms or faster delivery when needed.

This creates valuation risk. A buyer assumes they can maintain your COGS and supplier relationships. But they can't, not immediately. They inherit supplier accounts but not supplier trust. They can't negotiate as effectively because they don't know the leverage points. They can't solve problems as quickly because they don't have relationship history to draw on.

The solution is documenting supplier relationship knowledge. For each supplier, document more than just contact information and terms. Document negotiation history, quality issues and resolutions, flexibility on minimums and payment terms, rush order capability, communication preferences, key relationship contacts. Document why you chose this supplier over alternatives. Document what makes the relationship valuable beyond price.

This feels like documenting obvious information when you're doing it. You already know all of this. But a buyer doesn't. They need this documentation to maintain supplier relationships effectively. Without it, they spend six to 12 months relearning what you already know, and they probably make expensive mistakes in the process. Supplier documentation also helps if key supplier relationships are personal. If you have suppliers who give you preferential treatment because of long relationship history, document that explicitly. Buyers need to know which supplier relationships will require rebuilding versus which ones will transfer automatically. This lets them price the transition risk appropriately instead of discovering it post-acquisition.