// STARTUP COMPARISON
Totalpack vs Debenhams
Totalpack failed in 2021 due to Competition. Debenhams failed in 2021 due to Competition. Both failed for the same reason — Competition.
| METRIC | 🔥 Totalpack | 🔥 Debenhams |
|---|---|---|
| Sector | Ecommerce | Ecommerce |
| Country | Chile | UK |
| Founded | 2000 | 1778 |
| Died | 2021 | 2021 |
| Raised | Bootstrapped | Public company |
| Peak | 3,000 SME clients | £2.9B revenue · 166 stores |
| Primary Cause | Competition | Competition |
// WHY EACH FAILED
🔥 Totalpack
Competition
Totalpack was Chile's leading supplier of packaging materials and e-commerce fulfillment supplies for SMEs, with 3,000 active clients. Amazon Business launched in Chile in 2020, offering competing packaging products at lower prices with next-day delivery. Amazon's global supplier network enabled price points Totalpack could not match. Revenue declined 60% over 18 months. Totalpack filed for insolvency in 2021.
// LESSON
B2B supply distribution businesses are vulnerable to Amazon Business in any market Amazon enters. The window between Amazon's entry and volume migration is 12-18 months. Use it to build value-added services Amazon can't replicate, or exit.
B2B supply distribution businesses are vulnerable to Amazon Business in any market Amazon enters. The window between Amazon's entry and volume migration is 12-18 months. Use it to build value-added services Amazon can't replicate, or exit.
🔥 Debenhams
Competition
Debenhams entered administration in April 2019, was rescued, entered administration again in December 2020, and closed all 166 stores in May 2021. A combination of online retail competition, £600M in private equity debt loading, and COVID-19 lockdowns destroyed the business over a decade.
// LESSON
Private equity debt loading on a structurally declining business accelerates the inevitable. Debt amplifies both upside and downside. On the way down, it is a death sentence.
Private equity debt loading on a structurally declining business accelerates the inevitable. Debt amplifies both upside and downside. On the way down, it is a death sentence.
// EXPLORE FURTHER