Website Closers® presents a leading eCommerce company comprising two esteemed brands. The company has done a tremendous job of creating brands that stick with consumers and stand out, both in the eCommerce segment via their branded websites and Amazon, as well as wholesale/retail, where they sell via Faire and directly to Michaels, Nordstrom and Target.
The brands work well together, but are still separate and distinct.
One brand is a perfect solution for those looking for unique gifts, party decorations and favor for life’s special events, like weddings, baby showers, bridal showers, and birthday celebrations.
The other brand is focused on newborns and infants – special and highly unique gifts for new parents.
Business Broker Takeaway
Our analysis of this business shows that the value propositions are strong for a buyer looking to enter the online space. We are excited about this business for three important reasons:
- It has meticulously developed multiple established sales channels and cultivated a vast customer base. Over the past two decades, the founders have forged partnerships with numerous major retailers, supplying them with substantial wholesale and direct-to-consumer arms. Revenue is fueled by Amazon, which contributes 70% through 1P and 3P relationships. Supplementary sales are made on the brand’s Shopify stores, Etsy, Faire.com, Michael’s, Nordstrom, Target, and Walmart.
- The company prides itself on holding seven registered trademarks and over 130 copyrighted designs. Its extensive product range consists of 450 SKUs, with the majority being exclusive. This diversity empowers management with the flexibility to pursue growth opportunities across various avenues.
- Robust Standard Operating Procedures are firmly in place, ensuring streamlined and optimal performance. A dedicated team of employees, many of whom have been integral to the business for several years, possesses an intimate understanding of its operations. They stand ready to assist a buyer with a seamless ownership transition, adding significant value to the acquisition process.
Inventory & Sourcing
Products are sourced and manufactured in Asia. The owners leverage a longstanding partnership with a trusted agent with whom they have worked since the company’s inception. They benefit from advantageous net 30 payment terms, with the possibility of further negotiation that a buyer can pursue should they desire.
Nearly all products feature the company’s original designs, with the remaining items being white-labeled and branded under their name.
Depending on seasonal demands, between $1.2 million and $1.9 million worth of stock is maintained at the company’s warehouse, where an average of 180 orders are processed daily.
Inventory replenishment occurs bi-weekly or monthly and is adaptable based on the business’s needs.
Revenue Optimization, Marketing, & Customer Base
The company has garnered recognition from Amazon as a frontrunner in its respective categories, leading to 50% of its revenue generated through the marketplace’s 1P program. This symbiotic relationship not only boosts its margins and sales volume but also streamlines operations, requiring less effort. Management demonstrates strategic foresight by initiating product launches through FBA to gain quality reviews and credibility, before transitioning to wholesale directly for Amazon to manage.
A pragmatic yet impactful marketing strategy is employed, evidenced by consistently impressive returns on investment. In-house SEO, Google Ads, and AMS management ensure effective promotion for third-party sales on Amazon and Shopify stores.
The typical customer demographic skews towards females aged 25 to 65 who shop for themselves or their loved ones for wedding and baby showers.
Sales remain strong year-round due to astute practices that mitigate seasonal fluctuations. By offering decor items popular during holiday seasons, when there’s typically a lull in events like weddings and baby showers, the company adeptly evens out demand, ensuring steady revenue.
Workload & Team
The owners dedicate between 20 and 30 hours weekly to the business, primarily managing their capable team.
Employees work in product development, sales, sourcing, customer service, warehousing, accounting, and operations.
Summary
The party favor, wedding, and baby gift categories represent evergreen verticals, showcasing steady performance over time. This well-established company encompasses two flourishing brands backed by a track record of success. With a diversified portfolio spanning multiple sales channels and revenue streams, risks are significantly mitigated, positioning a buyer for a healthy return on investment. A new owner stands to inherit a thriving business with plenty of avenues for expansion and scalability.
