6 y.o. - Amazon FBA business - High margin

Overview

Upward Exits presents a 6-year-old Amazon business selling jewelry that primarily utilizes FBA fulfillment. The seller has hired 2 virtual assistants to run the operations who are willing to stay with the company. This makes the business run very smoothly and will take very little time from a new owner. The business hold approximately $10k in inventory. 

The business sells primarily on Amazon. Because of the business’ duration on Amazon and track record of customer service, the products rank highly in most search results. The business has also utilized Amazon PPC to get even more product exposure.

 In addition to the Amazon listings, the business also has productive Ebay and Etsy accounts, as well as an Ecommerce storefront where a small percentage of the sales come from currently. A new owner could expand marketing efforts by further promoting the Shopify store on Google Shopping and/or social media.

IndustryJewelry
Business ModelAmazon FBA
Time Commitment (from seller)3 Hrs./ Week
Age6 Years
12 mo. Profit$70,000
Asking Price$170,000
Approximate Inventory$10,000
Valuation Multiple2.4 X

Operations

The two virtual assistants who run 80% of the business will stay on to work for the new owner, minimizing the new owner’s time commitment. They have been with the company for an extended period of time and are familiar with the business.

The products are sourced from one of a few manufacturers that the business has used, all of whom are located in China. The lead time on product creation and shipping to the Amazon warehouses is 2-5 weeks.

The seller has a streamlined process in place to design new products and get them put into production by the manufacturer. The products are proprietary and take very little time to develop.

Business History

The business is 6 years old and has been operated by the seller and his team since inception.

Reason for Sale

Seller is looking to fund other business ventures

Deal Structure

The seller is open to various types of offers but would like a large cash down payment.  We have advised him that he should be able to get that with a business in this price range and this amount of history.

Buyer Profile

Amazon businesses in this size and price range can appeal to hobbyists, career changers and individuals or groups already selling on Amazon and looking to expand

Summary

IndustryJewelry
Business ModelAmazon FBA
Time Commitment (from seller)3 Hrs./ Week
Age6 Years
12 mo. Profit$70,000
Asking Price$170,000
Approximate Inventory$10,000
Valuation Multiple2.4 X

Finance Overview

The seller did not have a bookkeeper, but has used a third party software (StitchLabs) that makes operations easier as well as helping to track financials and streamline inventory tracking.

Assets

  • Amazon Seller Central accounts for: North America, Europe, Japan

  • Etsy & Ebay accounts

  • Amazon Brand Registry 1.0

  • Ecommerce storefront built and hosted on Shopify

  • Business relationships with virtual assistants and manufacturers

  • Social media account

  • Inventory

Opportunities & Risks

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.

Seller Interview

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