MySize Inc said it has acquired Orgad, an omnichannel e-commerce platform operating globally, including the US and Europe, as it expands its business into e-commerce sales.
The company noted that Israel-headquartered Orgad operates as a third-party seller on a number of e-commerce sites and currently manages more than 1,000 stock-keeping units (SKUs), mainly in fashion, apparel and shoes, but is capable of managing tens of thousands of SKUs.
“The Orgad team has built a strong business as a direct seller of clothing and footwear globally on Amazon.com, eBay and elsewhere,” MySize CEO Ronen Luzon said in a statement.
“By using MySize technology, Orgad will be able to increase its profitability by increasing conversion rates and reducing costly returns, which also improves their sustainability."
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Under the transaction terms, MySize has agreed to pay Orgad’s owners up to $1 million in cash in three installments over a period of three years, equity of up to 2,790,049 MySize common shares, and certain earn-out payments upon meeting revenue targets, subject to the sellers being engaged with Orgad at the time each payment is due and also to post-closing adjustment.
Orgad generated approximately $2.5 million in revenue in 2021 with profitable operations. Its team consists of solid operators with deep understanding and knowledge in e-commerce, supply chain and technology.
MySize said its focus on technology, operations and customer service to increase efficiencies and revenue growth is structured on a platform that is able to manage numerous retailers. Additionally, it said Orgad will integrate MySizeID into its digital offerings and platform. Incorporating MySizeID into Orgad's e-commerce solution is expected to increase its operating profit by reducing costly returns, the company added.
"We have identified additional e-commerce global opportunities that would benefit from our e-commerce platform and digital management expertise,” Orgad founder Elad Bretfeld said.
“We look forward to scaling our business and working with the existing team at MySize."
MySize said it will continue to evaluate other proven e-commerce sellers as part of its acquisition strategy to bring vendors’ product selections to its customers.
“Our infrastructure of R&D and sales and marketing is in place and ready to increase revenues and improve margins as we scale,” Luzon concluded.
“We plan to expand our business rapidly by increasing the number of business managers, vendors and SKUs, which can also utilize MySizeID and SizeUP for the DIY market.”
MySize has developed a unique measurement technology based on sophisticated algorithms and cutting-edge technology with broad applications, including the apparel, e-commerce, DIY, shipping, and parcel delivery industries.
This proprietary measurement technology is driven by several algorithms that are able to calculate and record measurements in a variety of novel ways.
Contact the author at stephen.gunnion@proactiveinvestors.com