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Drop-ship firm CommerceHub will buy Mercent

December 18, 2014 04:09 PM
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CommerceHub, which helps retailers connect with suppliers that drop ship orders directly to consumers, says today it will buy Mercent Corp., a company that helps merchants list their products and sell on online marketplaces. Terms were not disclosed. The companies expect the deal to close in January.

The deal combines CommerceHub, with its links to 8,500 manufacturers and wholesalers that can drop-ship items on behalf of retailers, with Mercent, which specializes in helping retailers sell through such online shopping channels as the Amazon and eBay marketplaces and Google Shopping. The combined companies will provide an “omnichannel commerce experience from demand to doorstep,”CommerceHub says.

The merger will mean CommerceHub clients can help its clients sell better via online marketplaces and Mercent clients will have more access to supplier info, a Mercent spokeswoman says. “Through this merger, we’re connecting all of Mercent’s sources of supply to CommerceHub’s sources of demand to ensure brands and retailers grow profitably.” 

CommerceHub, founded in 1997, provides an Internet portal for retailers to connect with drop-shippers and exchange business documents such as purchase orders and shipment confirmations. CommerceHub in the past 12 months has processed some $8 billion in online orders, the company says, and Mercent about $2 billion. In 2013, CommerceHub handled more than 44 million e-commerce orders in the United States and Canada.

Mercent provides marketplace management services to 39 retailers in the Internet Retailer 500 Guide, including HSN Inc. (No. 26) and Market America (No. 57). Ten retailers use CommerceHub for fulfillment services, including Liberty Interactive Corp. (No. 6), the parent of QVC; and Costco Wholesale Corp. (No. 14). In the Second 500 Guide, nine e-retailers use Mercent while none are listed as employing CommerceHub.

"We evaluated all the providers in this space and consulted a number of large retailers regarding their current solutions. Mercent stood out as the only combination of enterprise-scale platform and services that are ready for the caliber of retailers we support,” says CommerceHub CEO Frank Poore. “By combining CommerceHub and Mercent, we will have an offering that enables retailers to radically expand their product assortment, generate greater demand, and optimize customer delivery from any source of supply, including stores, warehouses, drop-shippers, or third-party sellers.”

According to CommerceHub, the acquisition will provide the following advantages:

• Expand product assortments through a network of drop-ship suppliers and marketplace sellers

• More effectively promote products via such marketing and digital advertising channels as Google Shopping and Pinterest

• Launch marketplaces featuring third-party seller assortment with full monitoring and control of the entire delivery process

CommerceHub says it will combine teams and operate West Coast and East Coast offices—Mercent is based in Seattle while CommerceHub calls Albany, NY, home. Eric Best, founder and CEO of Mercent, which launched in 2005, will take over as chief marketing officer for CommerceHub, reporting to Poole. “It’s a bigger company, more resources,” he says.

Mercent’s 100 employees will retain their jobs, Best says. CommerceHub employs 210 people, Poore says.

 

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