Amazon FBA Business for Sale – How to Find the Best Deal

Amazon FBA Business for Sale – How to Find the Best Deal

Amazon is by far the most popular eCommerce platform, and plenty of entrepreneurs have had great results with the FBA program. Starting a new FBA store is a time consuming process. Luckily there is an easier way – buy an Amazon FBA business for sale.

Table Of Contents

Benefits of owning an Amazon FBA business

The FBA model allows business owners to list, stock, and ship their products through Amazon. Because the platform gets so much traffic every day, FBA businesses have become a massively popular option for small business owners. If you’re interested in purchasing a small business, an FBA seller may be the answer. You should understand how remote fulfillment with FBA works, what to look for in a prospective FBA business, and how to know whether it’s the right choice for you.

What Is Amazon FBA?

Does Amazon FBA work?
Amazon FBA Business for Sale - How to Find the Best Deal 1

FBA, or Fulfillment by Amazon, is Amazon’s platform for third-party sellers. FBA business owners send their stock to Amazon’s fulfillment center either directly or from their manufacturer. Then, they create their Amazon listings and market their products. When they make a sale, Amazon handles the packaging and shipping of the product as well as communication with the buyer about shipping times and returns.

FBA can be an excellent business opportunity for new entrepreneurs because Amazon has such a large customer base. If you optimize your product listings, it’s very likely that they’ll be seen by shoppers interested in your brand. You don’t have to worry about making space for your stock or sourcing packaging and shipping materials. Remote fulfillment with FBA allows you to focus entirely on the branding and marketing aspects of being a small business owner, so it’s a good option for many sellers.

How to Buy an FBA Business

You may not have to start an FBA business from scratch to enjoy the benefits of the platform. Sometimes, business owners sell their FBA brands to other entrepreneurs. Not every Amazon FBA business for sale is a good deal, though. You have to carefully evaluate each business you consider to determine whether or not it would be lucrative for you.

Here are six steps to buying an FBA business:

1. Compile a list of options.

There are a wide variety of online marketplaces where entrepreneurs sell their businesses. Here are some of the most popular sites:

On these platforms, you can narrow down your search to Amazon FBA businesses. Then, further narrow down the results based on monthly income, the age of the business, and listing price. Try to look for businesses in industries you’re truly interested in. It’s much easier to maintain a successful business when you have some amount of knowledge and passion on the topic. If you are a beginner we strongly suggest to use a broker like Empire Flippers, Motion Invest or Investors Club to find an Amazon FBA business for sale.

warning

If you are a beginner we strongly suggest to use a broker like Empire Flippers, Motion Invest or Investors Club to find an Amazon FBA business for sale.

2. Look into the seller’s account health.

Amazon places certain rules and restrictions on their FBA sellers. You don’t want to buy a business that’s in bad standing with Amazon, so checking the account health should be your first step in evaluating a prospective business.

The best way to understand a seller’s account health is to check their seller rating. Amazon assigns a rating between 0 and 100 to FBA sellers based on customer feedback, chargebacks, shipping time, number of order cancellations, and a few other metrics. You should also make sure the business has no unpaid fees or other discrepancies with Amazon.

3. Calculate the expected fees.

Fees for FBA businesses are fairly complex. You should be well-versed in FBA fulfillment fees, referral fees, storage fees, and the other charges associated with the platform. The fees can vary based on the size and weight of your products as well as the category your products fall under. Therefore, two business owners with the same gross revenue per month might take home very different profits when the fees are removed.

It can be hard to precisely calculate the fees you’ll pay as an FBA business owner, but you can get an idea of the monthly charges by looking at the brand’s sales over the last year. Continue to narrow down your list of options based on which businesses make the most income with the lowest fees.

4. Research the suppliers.

A good relationship with your supplier or manufacturer is one of the key elements of a successful FBA business. Without your supplier, you don’t have any products to offer. It’s important that the supplier is transparent and easy to reach so that you can keep an open line of communication.

Ask the business owner about their contract with the supplier. Make sure you understand all of the terms, fees, lead times, and any other relevant information. Then, make contact with the manufacturer to get an understanding of what it’s like to work with them.

5. Make an offer.

When you’re ready to buy an FBA business, you should make an offer that’s competitive but not excessive. Amazon businesses usually sell for about 25 times their monthly profit. If the business you’re considering makes $2,000 in profit each month, expect to pay around $50,000 for the brand.

In some cases, though, it makes sense to offer more or less than this. For example, if the business has seen considerable growth recently and this growth is expected to continue, the seller may ask for more. If the business is less than two years old, you might offer a smaller sum.

6. Update the account information.

Once you buy a seller account, it’s time to update the information. Here are all of the things you’ll need to change before you can resume business operations:

  • Account password
  • Account name
  • Email address
  • Credit card information
  • Deposit bank account details
  • Tax information

Pros and Cons of Buying an FBA Business

For many aspiring entrepreneurs, buying an Amazon FBA business for sale is a great option. However, it may not be the right choice for all business owners. Before you spend thousands on an FBA business, you should consider whether or not it would be better to start your own business.

The greatest advantage to buying an FBA business is its existing success. Getting a business off the ground is typically the hardest part of the process, but buying an established business gives you a stronger sense of security. You can look back on the brand’s sales history to confirm that there is a demand for the product, and you don’t have to build up your customer base from scratch.

The biggest downside to buying an existing business is the large start-up cost. An Amazon business can sell for tens of thousands of dollars, and most new entrepreneurs don’t have the funds to purchase the brand outright. It can be risky to invest so much money at the beginning of your venture as success is never completely guaranteed.

When starting your own business, the funding can happen more gradually. You’ll still have some significant start-up costs when sourcing your product, but it won’t be as expensive as purchasing an FBA business. As you earn income from the business, you can invest a percentage of it back into the brand to help it grow.

If you’re passionate about owning a business in a highly specific niche, you also might not find an Amazon FBA business for sale that offers what you’re looking for. In this case, you could be very successful starting your own business because you won’t have as much competition.

If you find a business for sale that meets your requirements and aligns with your interests, it might be a successful way to turn a profit. Most importantly, though, do careful research before purchasing an FBA business. It’s not a small investment, so you need to be sure of exactly what you’re buying.

Starting an Amazon FBA business?

If you are just starting out and buying a ready established business is not an option make sure to read our guide on starting a successful Amazon FBA business in 6 simple steps.

Feature Image 1
Share via
Copy link
Powered by Social Snap