Online businesses seem to pop out of the blue and entrepreneurs are able to make a great deal of money in a short amount of time with limited effort. FBA or fulfillment by Amazon is the latest business venture that many entrepreneurs decide to take on. It entails acquiring numerous products that are easily listed on Amazon’s website and sent to the paying customer by Amazon’s warehouse. Not only is this a great space-saving idea, but the perfect business model when you really think about it!
Recently, investors have shown a great deal of interest in acquiring Amazon businesses that are turnkey and successful. Essentially, what draws investors in is the idea that the business is already up and running, but sells products in a category that the investor finds interesting. If you’ve ever wondered why investors are buying such businesses, here are a few of the most common reasons:
The acquired business offers scalability: Out of all of the enterprises available in our modern world, an FBA business is by far the most scalable. Not only can you forgo hiring a large team of employees to run the business, but you can slowly grow it as demand dictates. In short, you don’t have to do any trial and error, and you can easily expand the business to sell other products.
The business has already been established: The biggest draw for investors when it comes to Amazon businesses is that the business already has a basic following of customers and has the necessary feedback to continue its operations. Customers will never find out that the businesses changed hands, and since the business has already been established, someone has already done the trial and error for you.
Low Operational Costs
Operational costs are minimal: Not only do you not need a website for running an Amazon business, but you don’t actually have to go out and find customers. Best of all, Amazon only charges fees once the item actually sells, therefore, you don’t have to spend money unless you make money. Additionally, you can sell used products or new ones, but no one can dictate how you source the products that you sell.
Acquired Amazon businesses are profitable: Since you don’t have to worry about running your own website or hiring a team of employees, your Amazon business can yield significant profits. If you can keep the costs of operation low, your product profitability increases with each product you sell. In order to have consistent revenue for your company, new products will have to be listed regularly, but at least you’ll know what sells.
At the end of the day, why would I want to sell my amazon business? Many entrepreneurs start up and abandon their businesses once the venture has proven to be a success. An abandoned Amazon business is one that’s worth selling to investors because not only are they willing to pay your asking price, but the legacy of what you’ve built can continue. Though many entrepreneurs never think twice about selling their businesses, instead of leaving your customers hanging, you can give someone else the chance to grow the business and make it even more successful!