FOR SALE: Upward-Trending High-AOV Dropship eCommerce Store
* Since 2Q 2021 isn't over yet, revenue for 2Q 2021 has been estimated by dividing the revenue for Apr-May by 2 (to get the 2Q monthly average revenue) and then multiplying by 3 to get a projected revenue figure for all of 2Q 2021.
Top 5 Things to Know
1. The business is about 6 years old (having been started in the summer of 2015) and, as you can see from the graph above, its revenue has steadily increased since its inception (subject to regular seasonality).
2. Over the past 12 months (June 2020 - May 2021), the store did $565,686 in revenue and $81,441 in net profit. That translates to an average $6,788 net profit per month. Unlike most websites you see available to purchase, this site's traffic, revenues and profits have all been trending up-up-up over the last few years.
3. The store primarily uses the dropship model. This means that the vast majority of the products (including all of the high-ticket items) are shipped from the suppliers' warehouses directly to the customer. You never see or touch the high-ticket products! The owner does stock about $2-3k worth of consumable add-on/upsell products and ship these out himself, but these products are small and fit on a single 2' x 4' shelving unit. He just started selling these consumable products about six months ago since they have such good profit margins and create an opportunity to make recurring, ongoing sales to customers who purchased a high-ticket item previously.
4. The Average Order Value (AOV) is $2,106. With an average gross profit margin of 20.5% (after shipping & delivery costs), the average order generates an amazing $432 of gross profit. With such a large profit margin, there's plenty of room for marketing and advertising.
5. Thanks to its strong organic rankings, 73% of the store's traffic is free, organic traffic from Google and other search engines (making it the site's #1 traffic source by far). And organic traffic is trending upward from year to year.
The owner (who is a long-time member of Store Coach) is selling the business because he wants to pay off a couple of sizable debts related to other business ventures.
- Niche: Please sign NDA to begin due diligence & get additional information
- Store Model: ~99% dropship / ~1% of revenue from stock-and-ship
- Business/Website Age: ~6 years (started in summer of 2015)
- TTM Net Revenue: $565,686
- TTM Net Profit: $81,441
- Avg. Order Value (AOV): $2,106
- Avg. Profit Per Order: $432
- TTM Traffic Breakdown: 73% organic, 12% paid search, 9% direct, etc.
- Weekly Time Requirement: ~10 hours
Asking Price: $328,000
The asking price for this business is $328,000, calculated as follows...
$81,441 Trailing Twelve Months (TTM) Net Profit
x 4.0 Annual Earnings Multiplier*
+ $2,000 - $3,000 of consumables inventory on hand
* Given the site's age (~6 years), upward trends in traffic, revenues & profits, favorable traffic breakdown (73% organic and 9% direct), strong organic rankings, and high AOV and profit per order (among other favorable factors), Store Coach has assigned a 4.0x annual earnings multiplier to this website.
P&L and Financial Information
Here is the accrual-basis Profit & Loss Statement for the Trailing Twelve Months (TTM) of June 2020 - May 2021 (click on the image to see a full-size version of the P&L in a new tab)...
Over the past 12 months, Cost of Goods Sold (including shipping) was $449,536, which is 79.4674% of net revenue. This 79.4674% COGS percentage has been applied to the net revenue each month to yield the COGS figure for each of the 12 months in the P&L period.
Over the past year, the store has averaged $47,141 in revenue and $6,788 in bottom-line net profit per month. The average profit per order is a very robust $432 (allowing for a significant amount of paid advertising - see Growth Opportunities below), and the net profit margin (after ALL expenses) is 14.4%.
The buyer(s) will of course have the opportunity to perform due diligence and verify all of the income claims and other information presented in this listing. This will include doing a live "screen-share" web meeting to log in and view reports and transactions in the store admin panel, payment accounts, advertising accounts (Google, Bing, etc.), Google Analytics, etc.
About the Products & Suppliers
After you electronically sign the NDA, we will disclose the domain name of the website so you can view the website and see the types of products it sells.
As you can see from the Google Trends screenshot below (which shows USA search volume for the site's #1 keyword phrase for the 5-year period May 2016 - May 2021), the demand for the products the site sells is very stable (subject to seasonal variability) and trending upward.
The website currently has 4 suppliers: 2 for the main high-ticket items and 2 for the consumable products the owner started selling ~6 months ago. All of these supplier accounts (including introductions to the main contact for each supplier) will of course be transferred to the new owner as part of the sale.
Marketing and Traffic
Over the past 12 months (June 2020 - May 2021), 73% of traffic was free, organic traffic from Google and other search engines, making it the site's #1 traffic source. Paid search was the #2 traffic source (accounting for 12% of overall traffic), and direct traffic (from past customers & visitors who already knew the domain name of the store and navigated directly to the site) was the #3 traffic source (making up 9% of visitors). Here is the Acquisition Overview report from Google Analytics for June 2020 - May 2021.
As you can see in the Organic Traffic report below (also from Google Analytics, for the 3-year period June 2018 - May 2021), organic traffic has continued to increase over the past couple of years (subject to regular seasonality) as the site's rankings have continued to climb.
At its current operating level reflected in the P&L above, this store only takes ~10 hours per week to run. And most (if not all) of the day-to-day tasks could easily be outsourced or assigned to a Virtual Assistant (VA).
Following is a list of the daily/weekly operational tasks required to run the business:
- Processing orders
- Customer service (inquiries, order updates, etc.)
- Accounting and bookkeeping
- Managing ad campaigns
- Stock, price & catalog updates
The site can easily be managed and operated from anywhere in the world.
Note: If you are interested in acquiring this website and being a passive owner (rather than handling/overseeing the day-to-day operations yourself), the current owner is open to entering into an operations agreement wherein his team continues to operate the store for you for a reasonable operating fee. Inquire below for more information.
Top Growth Opportunities
Increase Paid Advertising Significantly - The owner doesn't do much paid advertising at all (primarily just some remarketing ads and low-daily-budget shopping ads). This isn't because paid ads aren't profitable; it's because his working capital restrictions are such that he really can't handle more sales than the site is already getting from its organic rankings. A fairly large percentage of customers choose to use Klarna financing, which is great but which also requires working capital (since Klarna doesn't release funds until the order has shipped, which is typically several days after the supplier requires payment). If it weren't for the owner's working capital issues (largely due to other business ventures), he would definitely be doing way more paid advertising than he's doing now.
Increase Base of Recurring Customers - Only about six months ago, the owner started selling consumable products that would appeal to both a) customers who purchase one of the high-ticket items sold on the site, and b) other customers who have not bought one of those products. These products are "consumables" that customers will purchase many times throughout the year, presenting a great opportunity for recurring sales. The site is already integrated with Klaviyo, which is the best-in-class eCommerce CRM and email marketing tool on the market. The site is also integrated with Smile.io, which is an incredible loyalty rewards program. These products have huge margins, are small, lightweight, and easy to ship. The suppliers make some of the best products on the market.
Wholesale Outreach - There are many businesses throughout the country that purchase these high-end products (in addition to consumers who purchase them for their homes). Reaching out to these businesses directly (rather than just letting the businesses find the site on their own, hopefully) would no-doubt generate a lot of additional sales. What's more, many of these businesses would likely return to place additional orders in future years.
Scale Up Marketing Efforts on Newly Added Product Line - Just in the last few weeks, the owner added a new line of products that are the same type of product the site has been selling for years, but also quite unique and appealing to a lot of customers. This new line of products is becoming increasingly popular in the marketplace. Ramping up marketing efforts for this new product line is a great growth opportunity for the new owner.
Do SEO Work to Improve Rankings Even More - The current owner isn't doing any SEO work at all (on-site or off-site). Adding new content and building links to the site represent huge opportunities to move the website up even higher in the rankings.
Included with the Sale
The sale includes all of the following...
- The domain name and website (including all textual and graphical content)
- All supplier accounts (4)
- All paid advertising accounts (Google, Microsoft and Facebook)
- All social profile accounts associated with the business
- All customer list and mailing lists
- "Consumables" inventory on hand (typically $2-3k at cost value)
- 30 days of training and transition support (including up to 20 hours of "live" help via web meeting, phone, etc.)
- The current owner will of course sign a non-compete agreement as part of the Asset Purchase Agreement (APA)
You can make an offer for this highly profitable eCommerce store here. We'll immediately present your offer to the seller. If he accepts 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 with the seller 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, payment accounts, sales reports, traffic reports in 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. The website/business owners are solely responsible for all figures, statements, claims and information provided on this page as well as all 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 figures, statements, claims and information provided by the website/business owners.