Introduction – A Trillion Dollar Global Market
Billions of consumers wanting access to innovative, hard-to-get USA and European brands at discounted prices!
International Consumer Spending On Cross Border Purchases
- International customers have high average order values across most regions.
- Australia, New Zealand, and Canada cross border shoppers have average order values around $200.
- Australian and Canadian power shoppers make up the majority of worldwide buyers.
- By providing access to new merchandise into new markets, Coaction can capitalize on growing economies.
Flash Sale Sites Are Growing Exponentially, But Most Keep A Domestic Focus
| Site | Launch | Membership | Monthly Volume | Daily Tranactions | Issue |
|---|---|---|---|---|---|
| Fab.com (US) | July 2011 Relaunch | 750,000 | 70,000 | 0.31% | Design and US Only |
| Ozsale (AUS/NZ) | 2007 | <2 Million | 143,000 | 0.24% | Customer Service |
| Zulily (UK) | Dec. 2009 | <4 Million | 400,000 | 0.33% | US Only |
| Brandsexclusive (AUS) | May 2009 | 1.2 Million | 200,000 | 0.37% | Low End Brands |
| Beyondtherack (CAN) | March 2009 | <4 Million | 325,000 | 0.27% | Customer Service |
Products And Brands To Increase Dramatically As Membership Increases
Short Term Focus
- Customer Acquisition – Deep market penetration into our existing markets.
- Brand Expansion – Add additional sales each day across existing product lines.
- Category Expansion – Add Men’s Wear, Children’s Wear, Home Décor, Electronics, and additional accessories. (e.g. watches and sunglasses.)
Longer Term Opportunities
- Grow into new markets by adding new distribution channels–South Africa, Hong Kong, Singapore, Europe, China, India, Brazil, and other territories in Latin America.
- Each new market will have different demands for alternative US and European brands and products (e.g. travel, electronics, or wine).
Coaction Has Positioned Itself With A Strong Infrastructure And Is Ready to Grow Rapidly
- We have tested sales and distribution with the initial marketing database.
- We have a proven partnership with AtLast Fulfillment, who has scaled with other domestic sites such as zulily.com.
- We have established relationships with multiple brands. Including:
- Relationships with over 100 apparel brands and hundreds of cosmetic brands.
- Private label cosmetic and beauty product manufacturing.
- We have an established internal infrastructure:
- Experience building multiple Magento e-commerce platforms.
- Call center with 24 hour overflow coverage and the ability to take orders online.
- Inventory management, accounting, design, and photography.
- Proven e-mail delivery and analysis platform.
Actively Selling Women’s Apparel and Health + Beauty Products
| Category | Plan | Note |
|---|---|---|
| Average Order Value | $105 | Average Order Value (AOV) assumes the purchase of a apparel and beauty item. This value is well below current AOV of Cross Border shoppers. |
| Shipping Charge | $12 | $12 shipping assumes $15/order shipping with free shipping over $200. |
| Average Gross Sale | $117 | |
| Product Cost | $47.25 | Apparel markups are 2x and beauty products have a higher margin at 2.5x product costs |
| Sales Tax Assumption | $4.39 | Assume 3.75% sales tax expenses. Above this, assume we will pass along to consumer. |
| International Fulfillment | $12.50 | |
| Internet Shipping | $10 | |
| Credit Card Fees | $3.51 | |
| Returned Merchandise | $21 | Assumes we have to expense 20% of returned merchandise. Industry average is 5-10%. |
| Gross Margin | $18.35 | |
| Gross Margin % | 18% |
