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Grow Your Amazon FBA Business Before Selling It

Posted by Andrew Castaldy in Articles

Are you contemplating listing your Amazon FBA business for sale? Timing is everything when it comes to choosing a brokerage to work with and officially listing your Amazon FBA business.

Getting an initial valuation, not for the purpose of listing your company for sale, but for understanding some different drivers that can be used to enhance the value of your company is recommended for any owner who is contemplating sale in the next several years.

There are several crucial things you can do as an owner between now and officially listing the business as available for sale on a business brokerage site like Website Closers.

FBA businesses are increasing in popularity and because of their strong perceived value in the marketplace, buyers are snapping them up when these businesses have high quality and solid structures behind them. Amazon has one of the most advanced networks for fulfillment in the world, enabling people to step into a proven business model. However, it can be very difficult for the typical Amazon FBA business owner to scale beyond a few thousand dollars per month in revenue. In order to sell your business for maximum profit and have a positive experience with that sale, several different steps should be considered in advance by an Amazon FBA business owner to evaluate opportunities for growth.

First of all, you should be familiar with every product in your store as far as determining whether or not it is cost effective after all expenses and fees are accounted for. The most critical number to know before selling your company is the adjusted gross margin. The better records that you have from the beginning of your business, the easier it will be for you to track this data and to analyze it.

Without the right tracking in place, there is no way for you to determine the ongoing pulse and needs of your company. The second thing you can do to increase the value of your Amazon FBA business now is to capitalize on existing strengths that you have. Existing connections can help to grow your company quickly and you should always identify people who have a strong passion for the things that you are selling. This allows the business to grow together as part of a collaborative team rather than each individual member of the team.

All connections that you have, including with suppliers should be nurtured regularly. Ask questions about what you can do to improve costs, communication and quality. This shows your suppliers that you have a commitment to doing business as effectively as possible.

Another issue that often comes up with the sale of Amazon FBA businesses is that the prospective seller of the company has not built their own platform. Since you do not have direct access to the data from your customers that Amazon uses, this can hinder your long-term business growth.

You might wish to develop your own website and to promote and drive traffic to it as well to illustrate that the bounds of your Amazon FBA business extends beyond Amazon’s primary domain. When it’s time to sell your business, from the business valuation process through the closed negotiation, hiring an experienced business brokerage like the team working at Website Closers, recently named an Inc. 5000 company, can help you prepare for the right timing to sell.