FOR SALE: Multi-Channel Web Business Selling Custom Cartoon Art/Decor Products
Up for sale is a multi-channel web business that sells various types of custom cartoon-style art and decor products. The artwork/designs are all created "in-house" by the business' network of commission-based artists and designers, and all products are made-to-order and fulfilled by one of three Print-On-Demand (POD) suppliers. This makes order fulfillment very simple and streamlined. The sales channels include Etsy, Amazon and a stand-alone website (with eBay in the works).
Over the past 8 months (Aug 2020 - Mar 2021), the business has done an average of $29,460 revenue per month and an average of $7,752 net profit per month. The business boasts an amazing 50% gross profit margin (after design costs, product costs and shipping costs) and a very healthy 26.3% net profit margin (after all expenses).
Perhaps the most impressive thing about this business is its absolutely perfect 5-star rating on Etsy. The business has had ~3,400 sales on Etsy over the last year and received ~800 reviews, 100% of which are 5-star reviews. Most of the product listings on Amazon likewise have perfect 5-star ratings, though there are a handful with ratings in the 4.4 to 4.9-star range (still very good). Stellar ratings like this are extremely difficult to achieve in the custom art/decor niche, which is a testament to the 1) workmanship of the artists/designers, 2) the quality of the products, and 3) the professionalism of the customer service.
The business is as close to passive for the owner as possible. Two managers run all of the day-to-day operations and oversee a staff of 3 additional workers (plus a part-time chef who cooks for the team). The team handles all order processing, customer service, product fulfillment and listing/catalog management. This team has agreed to stay on for the new owner following the sale.
- Niche: Custom made-to-order art and decor products (please sign NDA to begin due diligence & get additional information)
Store Model: 100% drop-shipping / Print On Demand (POD)
P&L Period: 8 months ended Mar 2021
Business Age: ~1 year (launched in May 2020)
- Avg. Monthly Gross Revenue: $29,460
- Avg. Monthly Net Profit: $7,752
Gross Profit Margin: 50% of revenue
- Net Profit Margin: 26% of revenue
- Owner Time Requirement: 2-3 hours per week
Asking Price: $300,000
The sellers' $300,000 asking price was calculated as follows...
Avg. Monthly Net Profit (Aug 2020 - Mar 2021): $7,752
x 12 to Annualize Net Profit: $93,024
x 3.25x Annual Earnings Multiplier: $302,328
Rounded Down to $300,000
The key factors contributing to the 3.25x earnings multiplier are:
- the business sells its own unique brand of private label custom products (which creates significant barriers to entry)
- selling through multiple channels and marketplaces, diversifying the business' revenue streams
- one of the very first businesses to sell these types of products on these marketplaces (has a major "head start" over potential competitors)
- stellar ratings and reviews on Etsy and Amazon
- high gross profit margin (50%) and net profit margin (26%)
- streamlined order fulfillment and operations, requiring only 2-3 hours per week of owner time
- poised for continued growth, with the resources and personnel bandwidth to handle substantial growth without increasing fixed costs or hiring more people
P&L and Financial Information
Here is the P&L Statement for the most recent 8-month period (Aug 2020 - Mar 2021). Click on the image to see a larger version of the P&L in a new tab.
The current owners will of course give the eventual buyer the opportunity to conduct extensive due diligence, including a live "screen-share" web meeting where you’ll be able to view reports and transactions in the Shopify store admin panel, payment accounts, Etsy and Amazon marketplace accounts, payments to staff members, supplier invoices, subscription charges, etc. to verify and confirm all of the figures shown in the P&L above.
About the Niche & Supplier
As noted above, the store sells its own private-label brand of custom, made-to-order cartoon-style art and decor items. To learn more about the products and get links to the business' website and Etsy & Amazon storefronts, please sign the NDA.
The business was one of the very first to sell this type of product on marketplaces like Etsy and Amazon, giving it a substantial "leg up" over potential competitors. It has established stellar ratings on both Etsy (5.0 stars after ~800 reviews) and Amazon (most products are 5 stars, with a few 4.4 - 4.9 star products). This sets the business up for continued success in the future.
The business is 100% drop-shipping based, meaning that the supplier ships products directly to the customers. This means that you do NOT have to pre-purchase large quantities of inventory, store products in a warehouse, or manually ship out orders yourself. When an order comes in and the artwork/design is completed, the suppliers ship the products directly to your customer. Dropshipping is hands-down the easiest store model and completely eliminates the need for working capital as well as the risk of not being able to sell large stocks of inventory you've pre-purchased.
Marketing and Traffic
As you can see in the P&L above, the business has 3 distinct revenue streams (and is in the process of adding eBay as a 4th revenue stream). This increases the products' exposure across selling platforms and provides revenue diversity, which minimizes risk. Over the past 8 months (Aug 2020 - Mar 2021), the revenue break-down is as follows:
Etsy - 65% of total revenue
- Amazon - 24% of total revenue
- Website - 11% of total revenue
The owner has historically focused the vast majority of their time and attention on marketplace listings (i.e. Etsy and Amazon, with eBay in the works) and haven't done much with the stand-alone website. But as the brand name has become more well-known and happy customers are coming back to purchase additional products (partially by way of newsletter mailings), the stand-alone website is making more sales.
The owner only spends 2-3 hours per week on the business. The two managers he has in place oversee virtually 100% of the day-to-day operations of the business, making it essentially passive for him.
When a customer places an order, the 2 managers (with the help of the 3 staff members who work under them) decides which of the ~30 freelance artists/designers to have create the artwork. All of these freelance artists/designers are paid a flat 30%-of-revenue fee to do the artwork and are obligated to provide unlimited revisions to the customer until the customer is 100% satisfied with the artwork/design. This is how the business is able to maintain its immaculate 5-star rating on Etsy (and near-perfect rating on Amazon).
Once the customer gives final approval on the artwork/design, the team sends the order to the appropriate Print-On-Demand (POD) supplier(s) to create the products based on the custom artwork/design. (The business currently has 3 POD suppliers, one for each of the 3 main lines of products.) The item(s) ordered by the customer are then drop-shipped (i.e. shipped directly) to the customer from the supplier's facility.
The team uses a sophisticated, custom software program (included with the sale) to manage this entire process and ensure a smooth and efficient process for every order. The custom software program was built to carefully manage the flow of orders and create a single platform for all interactions between the staff and the artists/designers. It organizes all the orders from the time of customer’s purchase until the final product is sent to the customer. The software also tracks the amount owed to the designers.
All of the team members have agreed to stay on board for the new owner after the sale is completed.
This business can easily be managed and operated from anywhere in the world.
Top Growth Opportunities
Expand the Product Catalog - The possibilities are truly endless with this product line. (Once you sign the NDA and see the types of products being sold, the expansion opportunities will be obvious.) The catalog could easily be expanded tenfold, by expanding both the types/styles of artwork and designs and the types of products the artwork/designs was put on.
- Sell on International Marketplaces - Currently, the vast majority of sales are to Americans through US sales channels (primarily Etsy.com and Amazon.com USA). But many Europeans and customers from other countries around the world very much like the products and purchase them, even though they're only listed offered in US marketplaces. Sales would no-doubt increase substantially if the new owner took the time to list the products in international marketplaces (starting with international Amazon sites).
Expand Paid Advertising - Thus far, the business has done very little paid advertising. The vast majority of sales have been organic sales through the Etsy marketplace, Amazon marketplace and returning customers to the stand-alone website. The owner has tinkered with some limited paid advertising campaigns (the results of which have been promising, with a Return On Ad Spend (ROAS) of 3.0+. But he's been focused on infrastructure and streamlining the business, not on scaling up paid advertising. An experienced Internet marketer could easily double or triple (or more) revenues and profits by using paid advertising campaigns to drive more traffic to the website and products.
Included with the Sale
The sale includes all of the following...
- The primary domain name and website (including all textual and graphical content)
- Marketplace accounts and storefronts for Etsy, Amazon and eBay (in progress)
- The custom software the business has developed for managing orders, streamlining communications between staff and designers, and tracking designer fees
- Supplier account with the 3 Print-On-Demand (POD) suppliers
- All customer lists and email lists associated with the business
- All social media accounts (Facebook, Twitter, Instagram, Pinterest, and Tumblr)
- Ownership of all designs, artwork, and graphics (logos, photography, templates, etc.) owned by the business
- 30 days of support to train you/your team on how to run the business (first 20 hours via phone or live webinar/screen share, then Skype/email support after that)
- Note: The sellers will of course sign a non-compete as part of the sale agreement.
You can make an offer for this eCommerce store here. We will immediately present your offer to the sellers. If they accept your offer, we'll notify you immediately and update this page to let other interested parties know that an offer has been accepted.
Once your offer is accepted, a 10-day due diligence period will begin (during which time other interested parties may place a "back-up offer" in case the sale falls through for whatever reason). During this 10-day due diligence period, we'll work closely with you and the sellers to help you complete due diligence. Among other things, this will include doing a live screen-share web meeting so you can review financial information, the store admin panel, Amazon/Etsy/eBay/Redbubble reports, payment accounts, Google Analytics, supplier invoices, etc. We'll also send you the Asset Purchase Agreement (APA) for you to review.
Once the APA is signed and the sale is completed, we will update this page to let other interested parties know that the sale has been finalized and remove this listing from the Store Coach Website Marketplace.
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Disclaimer: Store Coach, Inc. is acting as the broker of the sale of this website/business and is merely presenting figures and information provided by the website/business owners. The website/business owners are solely responsible for all financial figures, statements, claims, and information provided on this page as well as all financial figures, statements, claims and information which may be provided to interested parties during the due diligence process. It is the responsibility of the eventual buyer to review and verify all financial figures, statements, claims, and information provided by the website/business owner.