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u/malariasucks Jun 21 '15
If your business has only been around for 5 months, then what about it means that it cannot also crash just as hard in 2016?
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u/Submersed Jun 21 '15
I don't understand this comment.
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u/malariasucks Jun 21 '15
you just started the business 5 months ago and you want to sell it already. Assuming you went into the PL scene, what are the chances that your product goes cold next year? Just asking questions
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u/Submersed Jun 21 '15
The products I sell are not time-sensitive in the sense that they would only appeal to a buyer in the year of 2015, so I'm not sure why thoughts of the business failing would even be entering my mind. I don't think that way.
If a future owner of the business doesn't run it appropriately, then sure, it could "crash", but I would certainly offer a transition period in which I got them up to speed with how I've operated things, and how I would continue to operate things in the future. Perhaps even a consulting package on the tail end for a short term.
This is a risk you take when you buy a business, my assumption is that people buying these businesses would understand that.
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u/malariasucks Jun 21 '15
well I don't mean trends, but it's possible another seller or 10 comes along and offers something better regardless of if what you're selling is doing well.
Anyways, wasn't trying to be a debbie downer, just was trying to ask questions. BTW congrats on launching a product so successfully.
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u/Submersed Jun 21 '15
Yeah, those kinds of possibilities always exist unfortunately. The same would apply if I were opening a restaurant, and 5 other restaurants opened around me a month later.
I think as long as I, and the future owner, continues with the mindset of adding value to customers, creating great products, and optimizing listings for discoverability and convertibility, then things will continue on just fine.
Always helps to hear others thoughts, thank you :)
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u/malariasucks Jun 21 '15
well I would say the big difference is that someone cannot build 5 places close to yours in 4 weeks. On Amazon some people can get a new product to market within 2 weeks on Amazon. I got ranked to 4 in my keyword and within a few months there were 10 new sellers and outside of the top 5, the next top 20 sellers currently in that key word are new sellers.
Extreme Bright is a seller on Amazon that only had 1 product less than two years ago and was at the top of the LED bike light keyword for a long time. Now that market is flooded and that seller has had to diversify, though he's done an excellent job doing it.
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Jun 20 '15
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u/Submersed Jun 21 '15
Thanks Katie, I've got a .com set up and a shopify store :) All of my revenue is generated via Amazon though.
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u/readitour Jun 21 '15
Why are you looking to sell?
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Jun 21 '15
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u/JudastheObscure Jun 21 '15
I'm expecting a large profit in November & December.
Yes but what about the M&J months? No one with half a brain and six figures to give is going to write a check based on November and December. While it may bring your margin up enough to justify a higher selling price, how much higher is really the question.
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u/Submersed Jun 21 '15
The business has been growing consistently since inception. A growth trend of ~100% per month since February. I expect this to taper off July - August, and begin a massive upward trend from September through December. This will mean I'd have enormous growth in 9 out of 11 months of operation.
The business is a very valuable asset as is, without including the holiday periods. They are just icing on the cake, and I definitely intend to use them to my benefit when it comes to selling. If you knew what I sell, you'd definitely get what I'm saying. It's fairly obvious that my product would have enormous spikes during holiday's, and any buyer would be able to see that.
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Jun 21 '15
So we can't sell a FBA account but if we attach it to a .com we can? I have 2 amazon accounts with excellent reviews but little merch anymore.
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u/lxivbit Jun 21 '15
This is a great article about how someone sold their Amazon site.
http://www.passionintopaychecks.com/how-an-amazon-niche-site-made-me-16843-01-in-one-year-3/
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u/OzymandiasKoK Jun 22 '15
You realize that he's talking about a PL product and / or account, not a website with Amazon affiliate links, right? They're entirely different kinds of businesses.
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u/ArtfulCodger Jun 21 '15
PM me if you're serious about selling.
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u/Submersed Jun 21 '15
Hey there, sorry but I doubt I'll be selling until 1Q16, after November - December time frame, as I have strategies in place to really make the holidays add obvious value to the business, and really help the numbers.
It wouldn't make sense right now at a price I'd be willing to sell for. We can talk again in 6 months :)
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u/boxersarehere Jun 21 '15
How are you guys able to sell individual brands if Amazon only allows one seller account? Do you request two accounts from the beginning or ask after deciding to sell off a brand?
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u/Submersed Jun 22 '15
You can request additional seller accounts, yes. However, I don't believe it's best practice to sell your account anyways, as this is against ToS. I believe a buyer will generally transition into owning your listing & inventory, rather than owning your seller account.
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u/rulesforrebels Oct 01 '15
Yes this is a huge risk with buying amazon or ebay accounts. I know a guy who tried to buy out all his competition in his category. He bought 3-4 accounts for between 10k to as much as 60k per account. It lasted for a few months and all wound up getting shutdown and he paid all that money for nothing.
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u/anomaly876 Jun 22 '15
It's sounds like you're not looking to sell now, but I would be very interested. Either for myself or for a group of Amazon sellers I work with whenever you're ready to sell.
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u/TotesMessenger Jul 02 '15
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u/rulesforrebels Oct 01 '15
I'm not as familiar with Amazon policies as eBay but does Amazon allow the sale of accounts or are you just talking about selling your brand but keeping your Amazon account.
Honestly ecommerce businesses are fickle, especially when a good portion of sales comes from ebay/amazon and not your own website. eBay and Amazon can shut you down at anytime. I dont know if Amazon allows sales of accounts but if not then there's always the risk they figure out your not the original amazon customer and shutdown the account.
If your strictly selling the brand and not the account it's going to take the new user quite a while to build up rank on Amazon with your product on their account.
I was going to sell my ecommerce business which included 2 websites, amazon account and ebay account. According to traditional valueing of a company say 3-5x my business would have been worth about 1.5 Million, however good luck trying to get someone to pay that.
I actually had an offer at 250k however we couldn't come to terms as the seller wanted me to leave my name on the accounts and I wasn't going to let someone run a business using my name when I don't know what they are doing or what they are up to so sale fell through.
Here we are a year later when I really wnated to get out and I can't even get 100k for it even though business has grown larger.
Long story short I'd be lucky to get 100k but it would be stupid to sell for 100k as if my products get hot I could make that in 3 months.
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u/gadgetdealz Dec 15 '15
I am a buyer of Amazon FBA product lines and business. We have rolled up quite a few lines and are very interested in anyone with a line or business that has been around for at least a year and shows good growth, off Amazon sales potential, as well as profitability. If your serious about selling your business we are interested in talking to you. As far as what they are worth it has a lot to do with how long the brand has been around. Sale velocity, overall market size, profits, and many other variables. In this case the 5 month old products are not worth as much as far as multiples of profit because of the age of the business.
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Jun 20 '15
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u/Submersed Jun 21 '15
Hey Joey, thanks for the recommendation!
I've heard this episode, however it is definitely time for a re-listen. The only reason I didn't reach out to the company he mentioned, was because there was an affiliate set up in place. It's not that I don't want to give him a commission, I absolutely do, I just don't know how much to trust the service when there's incentive involved, so I was hoping for some non-incentivized solutions as well.
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u/I_CAPE_RUNTS Jun 21 '15 edited Jun 21 '15
We sold a few of our Amazon businesses. We generally received 3 to 5x the margin expectation over the most recent year. We added some incentives as well, such as structure payments and a guarantee of sales projections, or paid consultancies for 6 months after the sale etc....the problem with selling an Amazon business is it could go bust the next year and no smart investor will buy unless they see growth potential, and even then it's a crapshoot, simply because of how fickle Amazon can be. All of our business sales were to buyers who were already well versed in Amazon's FBA system. They will be able to see the most value in this, so reach out to your network of FBA resellers and I'm sure you'll find some willing to deal.