The Swiss Super League club tore Ludogorets apart on Tuesday with Breel Embolo, Derlis Gonzalez, Shkelzen Gashi and Marek Suchy scoring the goals for Basel at St Jakob-Park.
It was sweet revenge for Basel, after they went down 1-0 in Bulgaria a fortnight ago, while Dermendzhiev will have to put his team back together, as they slumped to last place in Group B of the Champions League.
"After the first game against them, we knew Basel would do everything to win," he said.
"That was the case. But we also made lots of individual and collective mistakes. That is, above all, why we lost."
While qualification for the round of 16 looks unlikely for Ludogorets, as they face Liverpool and Real Madrid on the final two matchdays of the group stage, Dermendzhiev reminded his team they must fight on to give them confidence in their domestic league - Bulgarian A Group.
Ludogorets sit second after 14 rounds with 28 points, five adrift of leaders CSKA Sofia.
"Now we have two matches, against Liverpool and Real, and we want to play to a high standard," Dermendzhiev said.
"Those are also good tests to see where we are in terms of the title race.
"In the league, we have to create the platform that will allow us to play in this competition next year and meet prestigious opponents such as Basel."
