sharing my thoughts on today's results....reading through the quarterly update and re-reading through the past announcements, it seems to me that dw8 is going through more than just integrating an acquisition.
imho dw8 is going through a pretty significant rebuild.
Kaddy and Winedepot went to market at the same time, solving the exact same problem - a fragmented b2b alcohol industry. where big margins are for resellers and retailers, and shitty margins go to the suppliers. They wanted to streamline this and get more money back to the suppliers.
Kaddy's solution has a unique hands on approach where buyers can 'request' access to a supplier and start ordering. this unique vetting step gives supplies a feeling of greater control - ie know thy customer. see their
demo video hereWinedepot went for a more of an ecommerce approach, where suppliers uploaded their catalogue and registered buyers would begin to buy.
Fast forward to late last year, and Kaddy's platform was beating winedepot's hands down, across all metrics. The only thing winedepot had going for it, was it was public with a larger market cap and it had previously purchased parton's wine distribution which was a converted asset for kaddy.
Dean and co knew this, so were forced to make the play to acquire Kaddy.
Back to today, it's unusual for a 'larger' company to acquire a platform and then for that platform to entirely replace the existing solution, but that is essentially what is happening. In other words, this isn't an acquisition. Kaddy and winedepot are merging, which is forcing a major rebuild.
Kaddy is a far superior b2b platform
Kaddy is a far superior brand name (far more brandable than winedepot, important for global aspirations)
Both teams appear on paper to match up evenly
Both companies bring unique buyers and sellers
Winedepot brings the logistics (via parton's wine distribution and wine delivery Australia acquisitions)
Given the importance of Kaddy to the overall success, to me this just highlights that we bought Kaddy for an absolute steal. But it also highlights that this transition is going to take a lot longer than people think.
You simply have to read today's announcement to see the company is going through a pretty serious rebuild. I'd hate to be the sales folks communicating the messaging at the moment, convincing suppliers to move across to kaddy, but stick with winedepot connect, winedepot direct, winedepot market etc...This is just creating unnecessary confusion.
Imo, Dean and co should have rebranded everything to Kaddy as soon as the last AGM, and clearly articulated that Kaddy is the focus and they are bolting on everything good from winedepot. The sooner we do this, the sooner that level of clarity can feed through to employees, customers and shareholders.
Kaddy, a global b2b ordering platform with logistics and payments...that's the type of company that will find us on the NASDAQ in the not too distant future!
I remain bullish and look forward to the next 12 months. Good luck to all holders.
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