- Posted on April 6, 2022
- by Benedict Dohmen
Is It Time to Sell Your Amazon FBA Brand?
You started with modest beginnings and nurtured your Amazon FBA brand until it experienced some growth. After being in business for a few years, your sales have an upward trajectory, there’s high growth potential, and you wonder if it might be time to let go of the reins and sell your business to an Amazon FBA buyer.
Selling your Amazon business can be a tricky affair. Your business means a lot to you and you naturally want to get the best price for it. After all, it represents years of hard work, lessons, and eventual success.
How do you know when to sell your Amazon FBA and when should you do it for the most profitable results? In this article, we’ll tell you all you need to know so that you can time your ultimate sale just right.
Table of сontents:
How do you know it’s time to sell your Amazon business?
Timing is essential, particularly when it comes to selling your Amazon FBA business to an Amazon FBA acquirer. While part of your decision should be based on business conditions, your priorities and how you want to spend your time also play a part in your choice.
Many Amazon FBA sellers want to sell their Amazon brand because:
- They feel that they’re done with Amazon FBA or feel that they’ve accomplished all that they’ve wanted in certain areas.
- The business has reached its peak earning potential on the platform and expansion isn’t likely to add much value for their investment or sales.
- Are unsatisfied with the growth of their business which has reached a plateau.
- They don’t want to put in more years of hard work to take their business to the next level and selling is the only way out.
- They’ve been doing Amazon FBA for a long time and are looking to concentrate their efforts in other areas.
You can find more reasons why owners sell their Amazon businesses here.
Business conditions for selling your Amazon FBA brand
Even if you have good personal reasons to sell your business, you may also need to wait and work until your business has reached certain milestones. If you let go of your business under the wrong circumstances, you may not be able to sell or get paid top dollar for the business you’ve worked so hard on.
Here’s how to know when to sell a fast-growing e-commerce brand:
Business growth
Are your sales growing or are they in decline? As you might expect, businesses are more attractive when they show profitability. In the case of Amazon businesses, this means a positive sales forecast and high growth potential.
This doesn’t mean that your business needs to demonstrate continuous increases in sales. There can be understandable dips from time to time but your overall sales records should show an upward trend that is likely to continue.
Here are other signs of growth that investors find attractive:
- The business shows an upward trajectory in the past 12 months.
- Your brand’s EBITDA has reached or surpassed a certain level.
- The business has promising growth opportunities in the next 12 months.
- You’ve made your Amazon FBA brand profitable to the point where it’s capable of generating a positive cash flow each month.
- Your Amazon FBA brand can command a premium price and still make money.
Business maturity
How long has your Amazon business been operating? Amazon FBA aggregators will naturally want to see proof of profitability and the ability to sustain those profits. You should thus be able to present financial records for at least two years.
Even if your enterprise is successful, if it’s less than two years old, bide your time and grow your business until you have a good track record to show interested Amazon roll-up firms.
When not to sell: never do it on impulse or because of emotions
Selling your Amazon FBA is one of the times when you shouldn’t rely on your emotions. If you’re tired, frustrated, or burnt out, it can lead to a hasty decision that you might regret later on.
While personal reasons will always partly drive business decisions, they should also be balanced with facts, business performance, and rational thinking. This will allow you to command the optimal price for something you’ve spent a lot of time building.
If you want to sell because you’ve been feeling upset or are frustrated by your business, perhaps you need to take a step back and take some time to help remind yourself why you started your business in the first place.
Key takeaway
When it comes to getting a good price for your Amazon FBA, timing is your best friend. If you can get it to work in your favor and achieve the conditions we mentioned here, you can make a great sale that will do justice to all the hard work you’ve put into your brand.
Want to know how to sell your Amazon FBA businesses?
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