Upward Exits presents a 5 year old Amazon FBA retailer of branded, high margin outdoor equipment.
The seller spent a lot of time and money to find a manufacturer that could consistently produce a high quality product on time and on budget. This attention to detail and product quality is the reason why the products have continued to receive great reviews, increase in sales every year and earn several amazon badges.
In addition to the high quality products that have amassed thousands of reviews, the seller worked with a reputable Amazon consultant to develop a product launching strategy that helped the business launch new products successfully. This consultant has indicated that he will be available at his standard rate to assist the future business owner.
Because the business only sells via Amazon FBA and the seller has streamlined the operations, the business takes only a few hours per week of the sellers time.
Recently the seller has brought on one of his childhood friends to spend a few hours per week managing the account.
The business is 5 years old and has been operated by the seller since its inception.
The seller has built the business into what it is today without any intention of selling it. He has a young family that he desires to spend more time with as well as dabbling in some other business ventures.
Like many business sellers, this seller has a bias for cash at close. The seller has indicated that he will potentially accept a small royalty or note if the buyer has a proven history of success selling on Amazon and he believes the final compensation is fair.
Although operating the business is not complicated, we don’t suggest that it be purchased by an industry newcomer. We believe that a current Amazon seller, private equity group or search fund would be the best buyer for the business due to it’s size and the capital required to purchase it.
The seller did not use a professional bookkeeper as he never planned on selling the business. The business does use third party sales software (Seller Board) to track financial performance and track inventory.
The financial statements have been created by exporting revenue and expenses from Amazon and COGs information from SellerBoard.
Amazon Seller Central account.
If the buyer is already an Amazon seller, they may propose an asset purchase where product listings are purchased instead of the Seller Central account.
Trademark for brand name
Business relationships with the consultant and manufacturer.
Social media accounts
Inventory (will be an additional cost calculated at close)
The seller has done a great job of creating a capable management team which mitigates some of the risk for the new buyer. Amazon businesses are seeing an increased number of competitors which have squeezed margins, however.
The opportunities in this business are to expand geographically and add a more meaningful eCommerce sales channel on the Shopify site by advertising on Google and social media. Because the products are highly regarded and proprietary, a wholesale channel could also be added.
This business is under a signed letter of intent.