Website Closers® presents an eCommerce company that has rooted itself deeply in the evergreen OTC, Haircare, and Skincare Verticals. Racking up sales that are growing nicely, this brand developed a tremendously lucrative foothold in the health and beauty products niche, that as a foundation is ready to be scaled under new ownership.
Leveraging the recurring profitability of daily use products, this business has strategically developed incredible industry relationships. With enormous potential to grow rapidly, this company could add products and branch into new categories while improving digital marketing to drive strong revenue and profitability growth. Their current 2021E projections put the business’s sales trend at roughly double their current TTM sales, so the growth for this business is astounding … and they have more than doubled their profits on a YOY analysis as well. A new owner will walk into a super high growth business in a sought-after Health & Wellness Vertical.
Focusing on OTC health and beauty products that are in high demand and increasing in popularity creates consistent and predictable demand for their goods. This well-developed business started out not with the products – but with research. Their goal was to find the products in the highest demand among consumers, then source them through their extensive supplier network. Earning the valuable Amazon approval to sell skincare products and over the counter medicines gave this brand the ability to continuously add new SKUs, including a wide variety of highly sought-after products used daily by millions. Thousands of additional SKUs can now be added to this foundation, making scale literally unlimited.
Excellent vendor relationships continued to provide this company with new sales opportunities by offering them additional brands that had just become available. Eventually their SKUs shot up to 460+, a huge catalog for a young business.
With their products picking up in sales, the company continued to source through individual retailers and distributors in the U.S., reselling brand name products that are well known to consumers. The business only sold products that software tools indicated would sell at a minimum of 1,000 units each month. They quickly developed several top selling products, including skincare creams and allergy medications. This system and process created by ownership will be trained with new ownership, making this acquisition not just highly interesting from a cash flow perspective, but from the opportunity it creates from the intangible know-how achieved during training.
With an average order value of $26 on Amazon and $17 on eBay, sales began to soar. In a clear demonstration of how well calculated their product selection was, at least 50% of their products now sell at least 1,000 units each month on Amazon, while a few sell upwards of 20,000+ units monthly, a stunningly high level of recurring revenue for these common but widely used products. In fact, the brand now has 20 items ranked as Best Sellers in Amazon’s Health & Household and Beauty & Personal Care categories.
Their sales remain steady year-round since their products are in such high demand, and the company benefits from the growing customer base that Amazon attracts. Their own customer demographics cut across all age groups, and the products appeal to consumers who use health and beauty items on a daily basis. Feedback from customers has been strong, and not just for the products themselves. With a 99% positive Seller rating on Amazon, the company draws high praise for fast deliveries and excellent customer service. Their products are conveniently housed in Amazon’s warehouses and shipped using Fulfillment by Amazon.
Expanding beyond B2C sales, this company could grow exponentially. At the moment, B2C sales still make up the vast bulk of their overall business, with 94% of gross revenue coming from Amazon and 4% of eBay. However, the company has started receiving bulk wholesale orders, now 2% of their sales and rising, and potentially quite lucrative, since their average order value on B2B sales is a hefty $9,890+.
A lot of the brand’s marketing efforts have been focused on building relationships with vendors. Leveraging their standing, the brand built strong relationships with business partners and wholesale distribution. Email marketing and text messaging have also been used to establish a reliable source for new products.
The brand has enormous growth opportunities by developing an assertive digital marketing campaign aimed at expanding its customer base. Those options include an aggressive new social media marketing campaign that focuses not just on their existing Facebook page but new accounts on popular sites such as Instagram and Pinterest.
The company could refocus their marketing efforts to encompass both their current offerings and direct consumers. This could include allowing customers to add their email address to a database that is used for regular email marketing campaigns offering sales and promotions, and a blog on the website to drive organic traffic.
Since the brand’s success to date owes much to their careful selection of top-selling SKUs, two terrific scale opportunities are to expand the product line even further, offering consumers more of the products they’re looking for, which is a quick way to increase revenue and diversify sales. The company already has 100+ new SKUs that are available for onboarding, products that are both in high demand and readily available from their vendors and protected from competition by Amazon’s gating policy for sale of these categories.
Similarly, a category expansion would help this brand scale significantly. Looking beyond health and beauty products, the company is already approved to begin listing items in new categories such as pet food/supplies, pesticides, toys, and grocery items.
Opting to expand onto new sales channels such as Walmart, Target, and other popular secondary eCommerce sites would also drive sales higher, and so would an international expansion using Amazon’s foreign platforms. Right now, the company only sells in the U.S.
The current owners spend between 30 and 40 hours per week operating this business, with the busiest hours during the holiday season when online spending increases significantly. The company currently carries no employees although they do use the services of a contractor who helps with inventory processing and eBay listings. They typically receive up to 10 customer service inquiries a day.
For a lot of new businesses, the first step towards success is to find a product or service that seems unique and is difficult to find elsewhere, then use creative marketing to find their audience. This company ingeniously reversed this trend, opening an eCommerce site that markets products that are already well-known to the public.
Their detailed market analysis has set them above the competition, enabling this business to select only products known to sell in exceedingly high volumes – and it worked. They have a formula that can now be replicated through additional SKUs and across new industries and product categories, giving a buyer the ability to take their $2.6 million in recurring revenues and drive it significantly higher.
