The title of the post is most self-explanatory: you’ve come this far to sell your Amazon FBA business and we’re going to explain where you can do it.
So… if your question is “how to sell my amazon business”? The first you need to ask yourself is “can I sell this?” Well, just as buying brands and businesses is a fairly common practice in the business world, there is always someone willing to invest in a good opportunity in the digital environment. It can be a profitable niche with stable traffic or, as in this case, an Amazon FBA that is generating revenue.
But you can also sell you Amazon FBM of MFN business. It might be not as easy as an “operations + logistics automated” Fulfillment By Amazon business, but if your FBM business works, there’s a huge chance it can be improved by using FBA so, yes, you can sell it too.
What is an Amazon aggregator or FBA acquirer?
I’m sure you’ve heard company names that do this. They are known as “Amazon aggregators” or “Amazon FBA acquirers” and typically acquire or participate in a part of your business to make it grow. Long story short: they buy an Amazon Business to skyrocket it’s profit in a certain period of time.
Like any startup, they usually have private investors behind them, both individuals and companies.
The best known companies in this business ecosystem are:
- Thras.io, valued at $ 1B
- Heyday, with $ 175M to invest in acquisitions
- Perch, with $ 123M
- SellerX, with more than $ 110M
- Boosted Commerce, with $ 87M
- Heroes, with $ 65M
There are other similar companies, but less known: Accel Club, Acquco, Yaba, Alpha Rock Capital, Cap Hill Brands, Centro Brands, Dragonfly, Flywheel Commerce, GOJA, Inflection Brands, Recombrands, Suma Brands, United, Thirstii, Zeelos or Orange Brands.
What kind of products do they buy?
Obviously, these companies do not buy any kind of products nor do they buy FBA accounts from any vendor.
They usually coincide in:
- Look for products that are not seasonal
- They do not want products that are trending (that increase their sales quickly and then stop selling)
- Products from gated categories or “dangerous” categories such as food, beverages, health, food supplements…
- Low margin products
- Trademarket products or brands
- Imitations or counterfeit products
- Products whose logistics are complicated. For example, heavy household appliances.
- Products that may expire
- Chinese sellers
- Products that may be suspected of having used black hat to get sales or reviews
- Products whose use could be dangerous, for example, an electronic toy for children
At the moment most of the businesses acquired by these companies are focused on Amazon, but they do not close to acquiring businesses from other marketplaces such as Walmart, for example.
How does the acquisition process work?
It is relatively simple and lasts 4 to 6 weeks. It usually starts with a step that you must take:
- connect your Seller Central with the acquirer
- or send them your Storefront URL, ASIN list…
Whatever information gives they an approach to your FBA business.
1st week: Free Valuation and LOI
This first step will allow them to generate a free valuation of your Amazon business.
If they find it interesting, will lead to a Letter Of Intent (known as LOI). The estimated duration of this first step is 1 week.
2nd & 3rd week: Due Diligence
During weeks 2 and 3, a Due Diligence is carried out in which the numbers of your business are thoroughly evaluated.
And, of course, they will also study how it can be improved, that is, what are the growth levers it has and what would be the result of applying them (multiply x2 the billing, for example).
4th week: Legal document
During the fourth week the legal documents are prepared, presented and signed by both parties.
5th & 6th week: deal closing + fund transfer
In the fifth and sixth week, the deal will be closed and the transfer of funds will take place.
5 best places to sell your FBA business
If you’ve made enough money with that project and you’re looking for a golden retirement or, more likely, you need liquidity to start another venture, finding a buyer may be the perfect solution.
The problem is that you don’t always know where to start looking, so we’ve done the work for you and introduced you to these 5 potential buyers.
One of the first choices should always be Thrasio. They’ve been at this for quite a few years now and have bought many, many FBAs that they’ve been able to grow. To give you an idea of how hard they have hit, they are the fastest growing company to be valued at $1 billion and have already invested over $150 million in acquisitions (average deal: $1M).
Thrasio is simple, fast and offers you a fair price. Simple because they take care of absolutely everything, fast because they close deals within 35 days and offer the right price with interesting incentives.
Finally, they are Amazon specialists, not just investors, which means that you are leaving your brand in good hands and that the effort made so far will not be lost. In fact, they have proven to be able to grow turnover by more than 200% in the first year and this, by the way, can be seen in those incentives we were talking about.
It offers a more similar model to Thrasio since they are also investors and have specialized teams on Amazon to evaluate the operations and favor the transition once the deal is closed.
What we like most about SellerX is precisely the personalized approach they give to each transaction. It takes about a week to make the economic proposal, but they value in detail the particularities of each seller and offer us all the resources and information necessary to make the decision without pressure.
Once the agreement is reached, the sale of your FBA is done very quickly: in a month or a month and a half everything is ready.
With this sonorous name, we come to number 3 of our top. Heroes works in a very similar way to most of those already mentioned.
The process is simple, you just have to make an appointment with them, they will give you a call and basically tell you how they work, they will be interested in the details of your FBA and so on. Then, after sending you a confidentiality agreement, they will analyze the numbers, make an offer and, if everything goes well, you will be ready to sign the sale.
As you can see on the picture below, Heroes is funded by the Bruni twin brothers.
At Razor they are very clear about what they are looking for; they want products with a high quality that is reflected in the ratings, with a relatively low level of complexity and interesting current performance, that are established and have good growth prospects.
Otherwise they rely on a process that aims for transparency and speed.
There are basically three steps:
- closure and integration
Clients who have sold their FBA businesses to Razor have a very good opinion of the company, highlighting its honesty and seriousness when negotiating.
Flippa’s business model is a bit different. The first thing you will notice as soon as you enter their website is that it is a marketplace where you can buy and sell businesses of all kinds: affiliate sites, apps, digital services and, of course, Amazon stores.
They have a service that evaluates your business based on certain parameters and their experience. They cross-reference the historical data of your store (Amazon category, business model, turnover, age…) with those of up to 1,000 similar businesses that have already sold. If you are going to evaluate Flippa’s option, ask for this evaluation, this tool is totally free.
Then you will have to negotiate directly with the buyers because, unlike Thrasio, this is a service between users.
A similar service can be found at Empire Flippers.
These are the top 5 sites to sell your FBA business on Amazon, but there are many more options that you can evaluate. Any example? Well, we can tell you Heyday, Perch or the other brands we discussed at the beggining of the post.
If you are seriously considering taking this step, we recommend that you analyze in detail these tools and value each of the offers you receive, do not hesitate to talk to more than one of these services, it is best to find the most advantageous deal.
We hope you will tell us how the experience went, we are sure that in the future it will help many people who are in the same situation as you are right now.