Website Closers® presents an eCommerce Brand that has adopted a novel approach to the Rainwear Market. For over 12 years, they have sold a line of private label rain resistant fashion accessories, which include rain/sun hats and bags. Their primary products, however, are their umbrellas, which are uniquely designed to fit inside a bottle after use.
The convenience and novelty of their offerings has been a hit among their customers, leading to strong brand equity built and evidenced by their retail store’s Repeat Purchase Rate. They have over 75% Gross Margins and have sold to over 7,500 wholesale customers over the past decade, with the top 2% of stores accounting for about 30% of total wholesale revenue.
The brand’s core customer base consists of gift and fashion boutiques, with resorts and high-traffic stores repurchasing most frequently.
Business Broker Takeaways
1. Strong Product Reputation. The company has taken several steps to ensure quality in their products, such as sourcing many alternative frame manufacturers to find the best possible frames and running their umbrellas through rigorous wind tests.
These qualities have led to a product return average rate of only 0.5% of Total Sales, high customer satisfaction, and a 5 out of 5-star rating on the FAIRE Wholesale Marketplace.
2. Unique Appeal. The company’s no-drip benefit and charming design often creates a “Wow Factor” among their customer base, especially once shown how the product works.
This Wow Factor has made them highly successful on television promotions, with the brand having the potential to sell over $200,000 worth of umbrellas in 4 hours on the Today Show or Good Morning America.
They also market to wholesale customers through several geographically exclusive sales representative agencies in the US and Canada, attend multiple trade shows every year, and publish at least two wholesale-oriented catalogs annually.
3. Virtual Operations. One of the brand’s notable benefits is that they can be operated from anywhere in the world, which will allow a buyer to choose when and where they work. Many of their major operational functions, such as manufacturing, quality control, warehousing and distribution, personal selling and order entry/customer management, are outsourced to third parties, while ownership handles marketing and administrative tasks.
Scale Opportunities
There are several key opportunities available that a buyer could use to expand both revenue and the brand’s client base.
For example, they could add more umbrella types to their product portfolio, and by expanding their offering of personalized and/or customized bottle umbrellas. As their personalized umbrellas jumped from less than 2% of total umbrella sales to over 7% last year, cultivating this channel could lead to strong sales in the future.
The company is less represented in the western half of the US and in the Upper Midwest, as while these regions represent 31% of the total US population, they currently make up only 12% of the brand’s total revenue. The buyer can counter this by attending trade shows in these regions, working with strong rep groups, and boosting the brand’s existing marketing campaign.
The brand could also establish relationships with distributors in Europe, Asia, and South America for even stronger sales.
The brand can expand their marketing by investing in social media marketing efforts on platforms like Instagram, TikTok, and Pinterest, which would help them showcase their products to a wider audience.
They could also employ more videos and animations to demonstrate their products’ features, both for SEO purposes and for use by wholesale customers. Additionally, these additional marketing efforts could help them boost their online sales, which currently make up only about 14% of their total sales.
Conclusion
This deal offers many benefits for their buyer through their strong wholesale presence, longstanding relationships with an outsourced factory, and premium product designs. As the sellers have been unable to pursue the many scale opportunities available to this brand, an ambitious buyer could quickly elevate the business and make the most out of their unique product lineup.
