eCommerce Business in the Health & Beauty Vertical – Fragrances, Body Lotions & More – 90% of Sales on Amazon – $50 AOV – Hazardous Storage Space Access

Pending

Website Closers® presents a seasoned online retailer in the lucrative perfume vertical. This eCommerce company operates primarily on Amazon and has enjoyed success for over a decade. Products appeal to all ages, genders, and demographics and, as a result, have stood the test of time, which is particularly pertinent during the current economic climate.

The global perfume market was valued at $50.85 billion in 2022 and is expected to continue growing at a healthy rate. The demand for fragrances is attributed to the rising trend of personal grooming and the increasing demand for luxury and exotic fragrances. Moreover, increasing consumer spending on premium and lavish perfumes due to the high-income level and improving living standards drive the industry worldwide. In recent years, perfumes have evolved into a significant cosmetics and personal care sector. They have emerged as an essential product due to the growing trend of personal care, forming a part of pride and confidence.

The company purchases all products through wholesalers. Orders are placed from several vendors on a weekly or semi-weekly basis. Payment terms are typically net 30.

The business makes use of a 100% stock inventory model. All inventory is stored in-house or at Amazon warehouses, where 20% of orders are fulfilled. The company ships 100 to 120 orders daily from its 2000- square-foot facility.

The business currently has around $1.8 million in inventory, and management has strategically increased those levels yearly. Typically, an additional loan is taken out annually to house more stock during the Christmas season. This is necessary as sales soar by 500% over the year-end holiday period. Amazon has a loan program that the business utilizes to increase sales when demand is rife. Additional sales peaks occur on Valentine’s Day, Mother’s Day, Father’s Day, and Prime Day

The owner operates the business and chiefly focuses on listing products, ordering, and customer service. Four additional staff take care of the operational aspect of the company. Their primary job is shipping orders to customers.

The company’s prestige, financials, and glowing reviews demonstrate its authority in the personal care sector. Given that it has never pursued any marketing endeavors, scale opportunities are vast and could skyrocket revenue to new heights.

Low-hanging fruit to boost sales is maintaining sufficient inventory. Although the brand has been actively increasing levels year after year, it regularly runs out of top-selling products. Subsequently, sales are squandered, rankings are affected, and repeat customer rates presumably decline. With astute stock management, sales and profits will increase with minimal effort.

Expanding into the skincare category is a potentially rewarding opportunity. Skincare is a prevalent segment, accounting for 33% of the beauty and personal care market. Pursuing this growth path would provide an additional revenue stream and enable the business to initiate the highly sought-after subscription model while cross-selling and up-selling products.

Since the current reviews will immediately help products rank, expanding sales to more locations is plain sailing. The brand has begun Amazon expansion to Brazil, Canada, and Mexico and should consider exploring additional regions where the perfume market is growing most rapidly.

The company could easily create a Shopify store. Through search engine advertising, a vigorous social media campaign, affiliate marketing, and influencer relationships, selling through a brand website would undoubtedly increase margins, promote a plethora of new marketing initiatives, and obtain an undiscovered prospective customer base. The company would also be able to compile a sizable email and SMS database for inexpensive advertising to publicize sales, endorse new items, foster client loyalty, and upsell customers at the point of purchase. Logistics would be straightforward, considering the business already ships 80% of orders from its warehouse.

Influencers reign supreme in the personal care, cosmetics, and beauty markets. Focused campaigns on TikTok and Instagram can significantly increase earnings if used wisely and could readily be managed by a social media agency or a dedicated employee.

This acquisition opportunity is primed for growth under capable stewardship willing to explore any of the abundant scale prospects available to them.