Interested in buying or selling an Amazon FBA business in 2021? Check out our guide.
Amazon FBA Business Buy & Sell
August 27, 2021
Having the ability to sell your business is one of the many perks of being a small business owner. You can take something from nothing to thriving, and then turn a hefty profit to invest into your next business idea.
Likewise, buying a successful business is an awesome opportunity for many who want to invest in something highly profitable and already functional.
Luckily, both of these are options with Amazon FBA Businesses! And in fact, buying and selling an FBA business is simple and achievable for anyone to figure out.
Why Sell My Amazon Store?
If you’re just getting started on Amazon, odds are you are baffled at the thought of selling your store. I get it - it takes a lot of work to build a business from scratch. But there are plenty of reasons to consider selling your profitable FBA business.
You really can’t begin entertaining this option until Amazon FBA businesses have been successfully generating profit for at least 2 years. Anything younger than this is a risky investment for aspiring buyers and you won’t get a great selling price on your store.
However, if your store has a track record of success over the past few years, it may be time to think about selling your private label.
You’re ready for a change.
Maybe your interests have changed and you’re ready to shake things up. It was fun building this store, but you’d rather open up that restaurant you’ve always dreamed of, or build a consulting business. Maybe you want to go back to school and pursue a more typical career. Wherever you’re headed, if you’re no longer enjoying the store you worked so hard to create, selling is a great way to profit off it.
You want startup capital for something new.
Let’s say you do have a new idea - but it’s going to cost money. Selling successful online businesses can give you a good nest egg that can help jump-start this new venture. That way you don’t have to start from scratch.
You’re ready to retire early.
Did you know that in 2019 alone, there were 18,000 Amazon sellers who made $1 million in sales1? 40,000 met the $50,000 mark, and over 150,000 made over $100,000 in sales that year. Plenty of third-party Amazon sellers are highly profitable. If you have had great success with your store for years, you may be able to retire early and enjoy the fruit of your labor.
You just want the cold, hard cash.
Your Amazon seller account can easily sell for about 2 times the amount of yearly net profit it produces. This amount of cash can be yours pretty much instantly, and without 2 years' worth of work. Granted - you will have to figure out how to replace that income over the next couple of years. But if you don’t mind building something from scratch, building and selling Amazon FBA businesses may just be the next highly profitable cycle to jump on board with.
You don’t need the extra income anymore.
If you’ve been using your Amazon FBA account as additional income but simply don’t need the additional money at the moment, you can always sell. Of course, extra income never hurts anyone, but it does come at the expense of working extra hours. Don’t want to deal with managing a store and don’t need to? Then sell.
These are all valid reasons to consider selling your store. Here are just a few reasons why you should not sell your Amazon store - or at least hold off for the time being.
Your store is less than 2 years old.
Buyers want to see that your store is able to perform well over time - so there’s no point in considering this option until you have a track record of success.
Your store is not turning a profit.
This should be obvious - but if your business earnings aren’t enough or not generating a lot of income, it won’t sell for much. Put in the work to get your business to a place of success and then sell.
You don’t have a plan.
If this has been your primary source of income and you have no other plans or options, don’t sell it. It’s best to have some idea of where you’re going before you completely jump ship!
For more tips on selling, check out this video we found with some more helpful selling info.
Why Should I Buy an Amazon Store?
Buying an Amazon Store is a big investment. As noted above, these stores can easily sell for about twice their annual profit - before taxes. That means that if the store is worth buying, it’s going to cost you.
That being said, buying an Amazon Store is only something to consider if you have a considerable amount of start-up capital ready to go. We’re talking hundreds of thousands of dollars here. This is a long-term investment, but a wise one.
Since the initial cost is so high, you’re paying up front for the first couple years of income (and hopefully you’ll be able to boost income so you earn back some of that money). You may not break even on your investment until year 3 or 4, considering taxes and interest if you took out a loan for the purchase.
However, once you do break even, you’ll have a hefty source of income at your disposal. You could even turn around and sell it to someone else for more money after you’ve scaled the business over the span of a few years.
This isn’t a game for new investors or lower middle-class entrepreneurs, however. Buying a successful Amazon store is something that only experienced, financially capable individuals should undertake, simply because of the large expense.
Another option for those who like the idea of buying an Amazon store but don’t want to shell out the hundreds of thousands of dollars necessary is to work with someone who will build a store from scratch for you, and let you keep the profits (without handling the day to day details).
Our Seller Start-up Studio does just that. You pay us (much less than you would pay to buy an existing storefront) to create your store, cover inventory and marketing fees, and we do the work. You get to enjoy the profits and own the business (meaning you get to sell whenever you want) while we manage the FBA store for you.
This is an excellent option for those who find the option of buying a store appealing, but don’t want to blow quite that much money from the start.
Where to Buy/Sell Amazon FBA Stores
There are a few locations where you can buy or sell Amazon FBA stores.
Popular options include:
Finding an Amazon store to buy is easy - most of these sites include a search bar. Simply search “Amazon store” or “Amazon FBA” to find existing stores for sale. To sell your store, visit the “sell” section of the site and follow the easy to use instructions available there. You can see some of the recent FBA stores available on Empire Flippers below to get a gauge for buy/sell price points.
How to Transfer Ownership
Once a sale has been completed, it can take a matter of months for the ownership to fully transfer to the buyer. However, profits belong to the buyer after the date of sale.
There are a few essential things that need to change immediately within the Seller Central account to begin the transfer of ownership.
- Change the charge and deposit methods. This includes the credit card associated with the account and the bank account where all profits are deposited.
- Change the account name and contact information. Update all account information to reflect the new owner, and give them login access to the store.
- Tax information. Update tax info so the new owner can appropriately receive their tax documents at the end of the year (and so you don’t get stuck paying taxes for income past the sale date).
These details can all be changed relatively easily. However, there are more specifics that you’ll need Amazon’s help with changing. There are of course other things to consider, such as subscriptions associated with the account, social media accounts, and more. We found a helpful guide from Flippa to guide you through this process step by step!
Of course, if you find yourself frustrated running the day to day operations of your business but enjoy owning it, another option is sourcing out the management so you can focus where your passion lies. Our EcomHub Agency option is a great choice for people in this predicament. You can choose a subscription that fits your needs and budget so we can help run and grow your business while you give your energy where you need to.
Buying or selling an Amazon business is definitely doable, but shouldn’t be done without a lot of consideration! Selling can be profitable if you have the years of experience and profit to make your store a desirable investment - but make sure you have a plan before letting go of something you worked so hard to build. Buying an Amazon store is a wise choice, but requires a lot of capital upfront. Be ready for that!
The important takeaway here is that the ways you can be successful with Amazon FBA are endless. Buying a store, building one and selling it, investing in a startup, or even outsourcing management so you can grow while focusing elsewhere - the options are endless. Just start somewhere!
Julia Grant is a copywriter specializing in e-commerce and small business, helping businesses expand their reach with copy that clearly communicates their message and converts. She is a certified translator and interpreter and prides herself on providing culturally relevant content in both English and Spanish.See more posts from this author