WebsiteClosers® presents an opportunity to acquire an online business that has grown significantly through its impressive collection of eCommerce storefronts that all operate in the Women’s Beauty and Apparel Sectors, two very lucrative verticals for that demographic. The company has enjoyed some of its strongest growth since introducing a popular subscription model, which results in 70% margins and a growing LTV.
The company’s popular brands include waist-slimming hosiery, undergarments, eyelashes, and eyebrow-shaping tools, all fully trademarked and unique to this business, which has made them popular with their fast-growing and loyal customer base.
So has the company’s subscription model, which has become enormously profitable, giving the company steadily increasing recurring revenues, an important consideration for a buyer looking for a business with solid profits and plenty of growth potential. The company now enjoys a 60% front-end subscription conversion rate.
The company also operates in a lucrative and evergreen niche vertical. The markets for women’s beauty and undergarment products continue to demonstrate impressive growth, and this company has demonstrated a clear understanding of what its customers are looking for. The company is bringing in $30,000 to $40,000 daily in front-end revenue, with its subscription-based business model contributing significantly to that. Customers pay a monthly fee of $30-$35, which gives them access to perks that include discounts, free shipping, and VIP access to a webpage offering complimentary products. This subscription model is enjoying 70% net margins and the VIP subscriptions are especially appealing to customers.
This business represents a clear opportunity for a U.S. Buyer to acquire this company and then scale it quickly by continuing to launch new SKUs for upsells and cross-sells, while also expanding all products onto Amazon. The company has already shifted one of its brands to Amazon, with impressive results.
Business Broker Takeaway
Our analysis of this business shows that the value propositions present are strong for a first-time buyer looking to get into the online space. We are excited about this business for 3 important reasons:
1. Strong Product Selection: The company is continuously researching product opportunities that are in the highest demand among their customer demographics to add to their catalog. This has also contributed to their enhanced profitability. This growth has sharply increased the company’s revenue from $500,000 monthly to $1.5 million in the past year. To keep this momentum going, the current owners have refined a process done weekly over the past four years, which focuses on testing products and establishing new stores. Each new store can then get added to the company’s profitable subscription model. All products are sourced from a private supplier this company has a solid and trusted relationship with, and the supplier can procure items from various manufacturers, giving this brand even more appealing SKUs in the future.
2. Creative Marketing: With 3 million subscribers, the company has a massive email database for marketing upsells, and it also takes full advantage of SMS texting messaging to reach out to its existing customers. The company has also been successful in running paid Facebook and Instagram ads to drive higher volumes of traffic to their websites, as well as to guide customers to their VIP subscription services. The company has been able to expand its customer base by employing a consistent and standardized process for testing and optimizing ads, and they are now getting 170,000 unique monthly visits to the company’s numerous websites. Their marketing plan has been particularly successful in reaching their key customer demographics of women between the ages of 45 and 54.
3. A Turnkey Operation: The current owners work 10 hours or less each week on the business, primarily focusing on making strategic long-term decisions that include which stores should join the subscription service, adjusting ad campaigns for scalability, and enhancing subscription sign-up rates. The owners also manage the process of weekly product testing, while an experienced and dedicated team manages daily operations through various roles within the company. These employees are eager to remain with a buyer post-acquisition. With this team in place, a new owner can focus on scaling this company and its numerous online stores.
The Company
From the start, the company’s strategy has been to curate a collection of DTC products on their websites, building up a customer base with seven leading apparel and cosmetics brands that operate on a “One-Product Store” model.
The introduction of a subscription model for these beauty and apparel products has contributed enormously to the company’s success, providing an increasingly larger monthly level of recurring revenue. As their base of subscribers continues to expand, those customers like what they’re getting since the company maintains high retention rates
This is giving the company substantial gross profits upfront as the percentage of new subscribers opting into the service keeps growing.
At the same time, the company continues researching related products that can be added to their listing array, and the business has an efficient and streamlined operation. The company operates with minimal overhead costs which contributes to their high margin business.
For a buyer eager to operate within the lucrative women’s beauty and apparel verticals, this multifaceted company has the ability to grow rapidly in multiple ways. The company recently enjoyed higher profits after launching one of its brands on Amazon, and adding the rest of its listing to the world’s largest online marketplace would be a surefire way to send profits skyrocketing. The company could add additional sales channels such as Walmart and eBay to the mix.
