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$MWK eCommerce 45% Growth 
Uses its own DATA analytics tool to spot BEST selling products ONLINE
Develops and sells these products through $AMZN
Plans to turn itself into a SaaS and open its SOFTWARE to third partiesHere is an EASY thread
$MWK Mohawk Group was founded in 2014 and went public in 2019 
$MWK sits at the crossroads of big data, eCommerce and Consumer Goods
In simple terms, it is a CPG (consumer packaged goods) company that develops and sells consumer products on Amazon and other eCommerce platforms
$MWK sits at the crossroads of big data, eCommerce and Consumer GoodsIn simple terms, it is a CPG (consumer packaged goods) company that develops and sells consumer products on Amazon and other eCommerce platforms
How is $MWK competitive?
$MWK scrapes the web and gathers data from leading eCommerce sites throughs APIs
It then knows what product are selling BEST (margins, turnover, customer satisfaction, market trends)
$MWK scrapes the web and gathers data from leading eCommerce sites throughs APIs It then knows what product are selling BEST (margins, turnover, customer satisfaction, market trends)
$MWK develops these products and sells these through various eCommerce platforms
Sales, marketing and pricing are also optimised using their internal data analytics tool “AIMEE”
$MWK is in fact a 2-headed venture
Consumer goods
Mohawk has developed 5 and acquired 6 brands and sells these on most eCommerce platforms
· Home, kitchen & environmental appliances
· Beauty related products
· Consumer electronics
· Health & Wellness products
Consumer goodsMohawk has developed 5 and acquired 6 brands and sells these on most eCommerce platforms
· Home, kitchen & environmental appliances
· Beauty related products
· Consumer electronics
· Health & Wellness products
Mohawk sells over 280 SKUs but doesn’t manufacture these, it just knows what sells well thanks to its data analytics
It then manufacture these through contract manufacturers, import and sell on e-commerce marketplaces
Almost all of their sales are made through Amazon
It then manufacture these through contract manufacturers, import and sell on e-commerce marketplaces Almost all of their sales are made through Amazon
Data analysis tool: “AIMEE”This stands for “AI Mohawk eCommerce Engine”
AIMEE sources data from various e-commerce platforms, the internet and publicly available data
AIMEE is integrated with marketplaces in the U.S., including Amazon, Walmart, Shopify and eBay
Allowing it to estimate trends, performance and consumer sentiment on products and searches within e-commerce platforms
Allowing it to estimate trends, performance and consumer sentiment on products and searches within e-commerce platforms
In 2018, $MWK started offering access to third party brands to its AIMEE platform
Turning the AIMEE product into an SaaS business
But why is AIMEE a valuable tool? 
Isn’t it so that customers are attached to the brands they know?
Customer habits CHANGE:
51% of millennials have no real preference between private labels & national brands
Only 22% of searches on Amazon include a brand name
When shopping online, 75% of US consumers said that they look for the products with best ratings & reviews
51% of millennials have no real preference between private labels & national brands Only 22% of searches on Amazon include a brand name When shopping online, 75% of US consumers said that they look for the products with best ratings & reviews
So $MWK is in a good spot as they understood that:
Customers look for products to solve their needs - not brands
Customers use reviews and ratings to guide their purchases
Some items sell more than other (higher turnover)
Customers look for products to solve their needs - not brands Customers use reviews and ratings to guide their purchases Some items sell more than other (higher turnover)
In fact, $AMZN is doing the same
It sold 22,600 private label products across 111 of its own brands in May 2020
Up from 6,800 products in June 2018
On average, the Amazon private label products score 4.3 stars out of 5 https://www.digitalcommerce360.com/2020/05/20/amazon-triples-its-private%E2%80%91label-product-offerings-in-2-years/
It sold 22,600 private label products across 111 of its own brands in May 2020 Up from 6,800 products in June 2018 On average, the Amazon private label products score 4.3 stars out of 5 https://www.digitalcommerce360.com/2020/05/20/amazon-triples-its-private%E2%80%91label-product-offerings-in-2-years/
Great! How the overall market doing?
According to eMarketer and Statista, global eCommerce sales stood at $ 4.4T in 2020 and are set to rise to $ 8.1T by 2025
Driven by wider eCommerce adoption, increasing mobile phone penetration and improving infrastructure
According to eMarketer and Statista, global eCommerce sales stood at $ 4.4T in 2020 and are set to rise to $ 8.1T by 2025 Driven by wider eCommerce adoption, increasing mobile phone penetration and improving infrastructure
According the eMarketer, US retail eCommerce sales are set to grow from $ 600B in 2019 to $ 1.2B by 2024 Boosted by a 32% increase over the 2019 - 2020 period due to the pandemic
eCommerce sales reached 14.4% of total sales in 2020 and will climb to 20.6% by 2024“For one, many stores, particularly department stores, may close permanently. Secondly, we believe consumer shopping behaviors will permanently change.” https://www.emarketer.com/content/us-ecommerce-growth-jumps-more-than-30-accelerating-online-shopping-shift-by-nearly-2-years
Leading eCommerce players also gained market share in 2022
Top 10 eCommerce players accounted for 57.9% of sales in 2019, this now stands at 63.2%
$AMZN accounted for around 23% of total sales in Q3 2020, a slight decrease versus Q2 where is got 24% of sales
Top 10 eCommerce players accounted for 57.9% of sales in 2019, this now stands at 63.2% $AMZN accounted for around 23% of total sales in Q3 2020, a slight decrease versus Q2 where is got 24% of sales
Here is the full take from Digital Commerce 360 https://www.digitalcommerce360.com/2020/11/03/amazons-share-of-us-online-retail-revenue-dips-slightly-in-q3/
https://www.digitalcommerce360.com/2020/11/03/amazons-share-of-us-online-retail-revenue-dips-slightly-in-q3/
Great! But is Mohawk any better than other CPG companies?
$MWK ’s go-to-market takes 6 to 8 months versus 1.5 to 2 years for conventional CPGs
Marketing and sales are data driven and automated versus manual agency work for conventional CPGs
$MWK ’s go-to-market takes 6 to 8 months versus 1.5 to 2 years for conventional CPGs Marketing and sales are data driven and automated versus manual agency work for conventional CPGs
Mohawk’s data driven approach also enables it find best selling merchants
And buy these over as these lack the technology and scalability $MWK has built over time
$MWK is then only buying the listings, IP, assets and manufacturers relationships
And buy these over as these lack the technology and scalability $MWK has built over time $MWK is then only buying the listings, IP, assets and manufacturers relationships
What are the results?
$MWK now has 67 products with over $ 500k in annual sales
Remember Amazon’s 4.3 ratings on their own products? Well $MWK got 4.4/5 on average (for all of its products)
110 out of its +280 products are in the top 5 search results on $AMZN
$MWK now has 67 products with over $ 500k in annual sales Remember Amazon’s 4.3 ratings on their own products? Well $MWK got 4.4/5 on average (for all of its products) 110 out of its +280 products are in the top 5 search results on $AMZN
What’s next for $MWK ?
Optimise product economics by lowering manufacturing and logistical costs as sales volume grow
Chase higher value products in order to generate higher GMs
Monetise AIMEE platform to allow access to third party brands (was scheduled for Q4 2019)
Optimise product economics by lowering manufacturing and logistical costs as sales volume grow Chase higher value products in order to generate higher GMs Monetise AIMEE platform to allow access to third party brands (was scheduled for Q4 2019)
Financials Check Net revenue grew 45% YoY in Q3 ’20 to $ 59m versus $ 40.6m a year earlier
Gross margins expanded to 47.8% versus 43.2% a year earlier
Net loss of $ 800k versus a loss of $ 15m a year earlier
Curr. assets at $ 89m versus $ 47m in curr. liab.
THE BOTTOM LINE Mohawk is building a smart CPG player, driven by data and sales rather than marketing and branding It is fully taking advantage of the shift to private labels as consumers favour reviews and ratings over known-brands
Sales are growing fast and it manages to find additional growth by acquiring competitors at around 3 to 4 times TTM EBITDA On top of growing sales, it also manages to collect good reviews for its product and has over 33% of its products in the TOP 5 searches on Amazon
$MWK is reliant on the data it collects from leading eCommerce websites It is also overly reliant on Amazon, which might take steps to reduce Mohawk’s products rankings / appeal
Disclaimer - This is not investment advice in any form and investors are responsible for conducting their own research before investing.
Sources
✑ Investor presentation
✑ Company website
✑ Digital Commerce 360
✑ Statista
✑ eMarketer
✑ Crunchbase
Sources
✑ Investor presentation
✑ Company website
✑ Digital Commerce 360
✑ Statista
✑ eMarketer
✑ Crunchbase
✑ Marker
✑ Business Insider
✑ JungleScout
✑ Business Insider
✑ JungleScout
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