Deciding how to approach the process of selling your e-commerce business can be overwhelming or even confusing if you don’t have the assistance of a knowledgeable website broker to guide you through. Inventory is no doubt required to run your business and you have probably established clear systems and processes to help you stay on top of all of that inventory.
It is frequently the case that you would include a normal level of inventory in the purchase price of your company when you decide to sell your e-commerce business. The primary purpose of this is to make a good faith effort to allow the business to sustain current revenues already being generated by the company.
This means that everything over this normal amount that you include in the purchase price has to be bought by the buyer in addition to the underlying business valuation. There are several different factors that must be incorporated in your consideration of your inventory cost, including:
There are many different factors you can incorporate into the process of fine tuning and tweaking your business to prepare it for sale. The following factors can significantly enhance the value of your business beyond the inventory and current sales;
When thinking about selling your business, partnering with an established e-commerce sales firm can help you to accomplish many of your sales goals. A website broker should be familiar with the common tactics used to arrive at multiples, how to list your company online for sale, and how to vet potential buyers against who should make the short list for consideration. There are a lot of different factors that go into listing your company for sale, but you want the peace of mind and the confidence that your business broker is handling these processes as effectively as possible.
Selling an Amazon business is likely to be much easier when you have hired the support of an experienced online business broker. Most people begin their search with the question; can I sell my Amazon business? The short answer to this question is; yes.
Even if you know that now is the right time to open to the possibility of selling your company, it’s the decisions you make from this point forward that can influence your ability to get maximum value on your business sale.
Is it Time to Sell Your Business?
Most people who have a successful third party selling business on Amazon will be eligible to sell that company and receive compensation after identification of the right seller. There are three primary types of Amazon FBA business organization and it is important to realize which one of these applies to you before you begin, in order to get the most out of the selling process when hiring an experienced online business broker. These three types include private label, re-seller and proprietary products.
If you have your own brand, but exclusive contracts with wholesalers to sell on Amazon, it might be much easier to sell this type of a business because you’ll have some leverage and this is more appealing to buyers.
You may be purchasing products wholesale and make a margin while selling retail on Amazon. This may also be referred to as a model known as retail arbitrage. This type of business can be very difficult to sell even if your profit amount is high. There are a number of reasons why this version of an FBA business is much harder to sell.
This includes that supply can be an issue, that it is highly volatile since there is no method to appropriately control the amount of competition, and because a buyer is only essentially getting access to your seller account and not reaping other benefits that would typically be pursued in this type of situation.
If you have created a popular product or a formula or you have made a popular product’s formula better and this is unique to you and your brand, this is a gold standard in terms of a sale because buyers are willing to pay a premium. Your business is more defensible over the long term because you are the only one who sells this specific item. You may be confused about which one of these models apply to you.
Tips for Selling an Amazon FBA Business
It is very convoluted to figure out the exact steps necessary to sell an Amazon FBA business, which is why so many people turn the services of an experienced online business broker to determine the most appropriate way to go forward. An online business broker will have extensive experience in this field and be thoroughly knowledgeable about the negotiation process and the identification of the right type of buyers to begin with.
After preparing to sell your Amazon business and officially transfer your account, there are three mistakes that you should be aware of. Running an Amazon seller account requires adhering to all of the seller performance matrix that Amazon considers and understanding how these influence the overall value of your company.
Give a Good Picture of Work Put In Before Transferring an Amazon Account
Anyone who has recently purchased an Amazon account must also be clear about exactly what behaviors are required to ensure that these performance matrix that made the business so appealing to purchase, remain strong. Transferring an Amazon account post sale will be much easier when you’ve presented a solid case already.
A strong performance in and of itself is unlikely to convince someone; when selling your Amazon business, get ready to provide a clear overview of what’s been involved in your work up to this point in a brief overview, but do a deeper dive about the ongoing activities that must take place to continue generating revenue.
Will Training Help with Selling Your Amazon Business?
The seller of an Amazon account should provide, in an ideal situation, one week of personalized training, explaining the very clear business specifics that influence these matrix. This is because transferring an Amazon account comes with the same situation as establishing a brand-new seller account, because Amazon does not provide any clear training immediately.
The second mistake that you can make when getting ready to transfer an Amazon account is not being able to appropriately show to perspective buyers where the opportunities to grow and improve are within the business. There is increased competition every single year, so an Amazon seller must expect to work harder to keep the same margins in their business.
Without an appropriate growth plan, a new buyer of an Amazon seller account may become frustrated and overwhelmed. This is why when transferring an Amazon account, that initial week of training is so beneficial. The final mistake that can be made when getting ready to transferring an Amazon account is considering the tax position.
What You Should Know About Taxes Before Transferring an Amazon Seller Account
The tax situation can very well change with a new owner after transferring an Amazon account, meaning that a new owner is exposed to unremitted or uncollected sales taxes. It is very critical that any documents associated with the transfer of the Amazon account explain updates to the sales tax situation so that the new person taking over the company can avoid an unfortunate sales tax situation and so that he or she can be prepared to hit the ground running.
How to Keep an Open Mind Before Transferring an Amazon Seller Account
When transferring an Amazon account, it is necessary to consider all of the relevant factors involved in selling an Amazon business. Sitting down with an experienced online business broker is strongly recommended. Selling an Amazon business doesn’t have to be difficult but transferring your Amazon account can come with some risks if you are not clear of how to proceed most appropriately.
Scheduling a consultation with an online business broker can help you avoid many of the most common errors made by people thinking about transferring an Amazon account.
Thinking about selling an Amazon business? Then there is no doubt that you want to take every step possible to present your company in a favorable light before moving forward and listing it for sale.
Getting Sales Help from an Online Business Broker
An online business broker can help you with all aspects of your Amazon business sale; including the completion of your Amazon business valuation and consider all the various factors that should be put forward when selling your company. Becoming a profitable Amazon seller is an exciting prospect, but it’s also one that may lead people to pursue other entrepreneurial or life-related dreams and goals after the business has become profitable.
Moving on to another stage of your life means getting as much value as possible out of an Amazon business for sale. Becoming a profitable Amazon seller puts you in the best possible situation to sell your company for a great value and move on with your life.
Since many different sales on Amazon come from third-party sellers, many buyers do trust and buy from third parties, meaning that it is a great time to cash in and sell your Amazon business. There are extreme advantages to being an Amazon seller and when you have already built up the foundation and are thinking about selling your Amazon business, you can easily portray these to prospective buyers by maximizing your profit.
How to Make Your Store Appeal to Potential Buyers
First of all, these buyers don’t have worry about setting up an online shopping website and they can leverage the traffic that already comes to Amazon which is around a 150 million people per month. In order to become a profitable Amazon business, you’ll probably have already built up many of the structures inside the company that will make be seen with extreme value on the market.
These include selecting the right niche, becoming a proactive marketer and being competitive and knowing the competition. If you start with just one product on Amazon, you can enhance your profits significantly by selling a whole range of items.
You’ll have to take a close look at the market to figure out what is selling well at first and make sure that you capitalize on the holiday season. Christmas time is when many people, who are third-party sellers on Amazon, make a great deal of money.
If you are thinking about listing your Amazon business for sale next year, for example, you might contact an online business broker now and begin putting in place the marketing strategy to enhance your sales during the holiday rush.
This will show your business as profitable as possible and makes it a much more likely buy for people who are contemplating purchasing an Amazon business. Selling an Amazon business does not have to be hard when you identify an online business broker who can assist you with a free business valuation and an explanation of all the factors that will go into your online business listing, you are in a much better position to approach your sale.