Multi-Channel Web Business Selling Private Label Print-On-Demand (POD) Clothing - $7,341 Avg Monthly Net Profit
Up for sale is a 10.5-year-old multi-channel web business that sells its own unique private label brand of unique clothing products. All items are printed on demand (POD) and drop-shipped directly from a single supplier, making order fulfillment very simple and streamlined. The sales channels include Amazon, Etsy, eBay, Redbubble and a stand-alone website (which was just updated and re-launched in January 2020).
Over the past 12 months (June 2019 - May 2020), the business has done $255,326 in gross revenue (an average of $21,277 gross revenue per month) and $88,092 in net profit (an average of $7,341 net profit per month). The business boasts an amazing 55.3% gross profit margin (after product costs and shipping costs) and a very healthy 34.5% net profit margin (after all expenses).
Perhaps the most intriguing (and attractive) thing about this business is that its creators (the sellers - husband and wife) have never attempted any paid advertising for the business (other than "opting in" to a fully automated $3/day paid placement program on Etsy). The business is completely built on natural, organic traffic within each of its sales channels. A buyer with know-how and experience with PPC and other forms of paid advertising could likely double (or triple) revenues and very quickly increase the business' net profit with minimal effort.
- Niche: Unique private label clothing items (please sign NDA to begin due diligence & get additional information)
Store Model: 100% drop-shipping / Print On Demand (POD)
P&L Period: 12 months ended May 2020
Business Age: ~10.5 years (launched in 2010)
- Avg. Monthly Gross Revenue: $21,277
- Avg. Monthly Net Profit: $7,341
Gross Profit Margin: 55.3% of revenue
- Net Profit Margin: 34.5% of revenue
- Owner Time Requirement: ~15 hours per week
ASKING PRICE: $308,000
The sellers' $308,000 asking price was calculated as follows...
Trailing 12-Month Net Profit (Jun 2019 - May 2020): $88,092
x 3.5x Annual Earnings Multiplier: $308,322
Rounded Down to $308,000
The key factors justifying the 3.5x earnings multiplier are:
- the business' long 10.5-year history of consistent profits
- the business sells its own unique brand of private label products
- selling through multiple channels and marketplaces, diversifying the business' revenue streams
- high gross profit margin (55.3%) and net profit margin (34.5%)
- streamlined order fulfillment and operations, requiring only ~15 hours per week of labor (which could largely be outsourced or assigned to a VA)
- highly attractive growth opportunities, starting with the fact that this business has never done paid advertising
P&L and Financial Information
Here is the P&L Statement for the most recent 12-month period (June 2019 - May 2020). 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 store admin panel, payment accounts, Amazon, Etsy, eBay and Redbubble marketplace accounts, Google Analytics, 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 unique clothing products. To learn more about the products and get links to the business' Amazon, Etsy and eBay storefronts, please sign the NDA.
The business currently uses a single Print-On-Demand (POD) supplier for the fulfillment of all ~1,500 unique products in its catalog, which makes the fulfillment process very simple and streamlined. The sellers have negotiated highly discounted rates with the supplier, which will of course transfer over to the new owner. The business isn't contractually "locked in" to using this supplier long-term, so you would have the option to move all fulfillment to another POD supplier or use multiple/various POD suppliers (as the seller has done in past years). That being said, the sellers have been extremely satisfied with this POD supplier (in terms of quality, professionalism and profit margins) and don't see any reason to switch suppliers.
The business is 100% drop-shipping based, meaning that the suppliers ship 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, the supplier ships the order 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 several distinct revenue streams. This increases the products' exposure across selling platforms and provides revenue diversity, which minimizes risk. Over the past 12 months (June 2019 - May 2020), the revenue break-down is as follows:
- Amazon - 52.2% of total revenue
- Etsy - 24.8% of total revenue
- eBay - 20.8% of total revenue
- Website - 1.8% of total revenue
- Redbubble - 0.4% of total revenue
The sellers have historically focused the vast majority of their time and attention on marketplace listings (i.e. Amazon, Etsy and eBay) and haven't done much with their stand-alone website. But in January 2020, they updated and re-launched the website on Shopify and are working to increase its traffic and sales.
With the exception of a tiny $3/day fully automated paid placement program the sellers opted into on Etsy, 100% of the business' traffic is natural, organic traffic. The sellers have never used any form of paid advertising to drive additional traffic and sales.
At its current operating level reflected in the P&L above, this store takes approximately ~15 hours per week to run. The owners (husband and wife) handle the vast majority of operating tasks for the business. Most day-to-day tasks could easily be outsourced or assigned to a Virtual Assistant (VA).
The business (which is a sole proprietorship domiciled in South Dakota, USA) doesn't have any employees or full-time / part-time independent contractors. The owners do have a freelancer (whom they pay $25 per hour) they've been using as needed for the past few years, who is willing to work with the new owner. As you can see in the P&L, freelancer labor costs have averaged $223/month over the past 12 months.
This business can easily be managed and operated from anywhere in the world. In fact, the current owners (who are US citizens) are very "nomadic" and have lived in several different countries around the world (currently Spain) over the past ten years since they founded the business.
Top Growth Opportunities
Start Advertising!!! - As has been noted above, the sellers have never done ANY paid advertising for this business (outside of a tiny $3/day sponsored listing program they opted into on Etsy). Everything this business has achieved over the last 10 years has been completely natural (organic)... no pay-per-click ads, no Amazon ads, no Etsy or eBay ads... just natural traffic from people searching or browsing the various marketplaces the products are listed in. An experienced Internet marketer could easily double or triple (or more) revenues and profits by starting some paid advertising campaigns to drive more traffic to the products.
Expand the Product Catalog - The possibilities are truly endless with this product line. (Once you sign the NDA and see the styles/designs of the apparel the business sells, the expansion opportunities will be obvious.) The catalog could easily be expanded tenfold, and doing so wouldn't be all that difficult using the templates the sellers have created and been using.
- Sell on International Marketplaces - Currently, the vast majority of sales are to Americans through US sales channels (Amazon.com USA, Etsy and eBay). 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).
- Actively Pursue Wholesale Sales - As of now, the wholesale market remains untapped. The business currently sells products wholesale upon request only (when boutiques and stores take the time to request it via email or the site's contact form), but the products are ideal for large wholesale orders. Creating an official wholesale program and highlighting it more could lead to a major boost in sales.
Included with the Sale
The sale includes all of the following...
- The primary domain name and website (including all textual and graphical content), which was just updated and relaunched on Shopify in January 2020
- Marketplace accounts and storefronts for Amazon, Etsy, eBay and Redbubble (and a few other POD marketplace accounts)
- Supplier account with the POD supplier
- The United States trademark for the business' brand name
- 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 (note: approximately 2% of revenue is attributed to "artist series" designs that aren't owned by the business - the royalty agreements for these designs will need to be re-signed in order to continue selling these designs)
- 30 days of support to train you/your team on how to run the business, manage the ad campaigns, etc. (first 30 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.
Sign NDA to Begin Due Diligence
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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.