Business Plan Strategy Guide for Selling an Amazon Business
Nowadays, it’s very attractive to invest or sell an online business operating on Amazon’s marketplace.
Thousands of sellers have already experienced how profitable selling on Amazon can be.
Also, numerous marketplaces only connect sellers of businesses with potential buyers.
And then, after the business picks up some pace and achieves success, it’s time to look into the ways you can sell Amazon business assets.
This article lists some essential steps to follow to make sure that selling your successful Amazon business is a seamless process.
First, document your business and its operations
You may believe that this is something you don’t have to do right away. However, you’ll have to deal with it when you sell, and there’s no way around it.
The benefit of documenting everything right away is that you’ll be able to discover shortcomings or problems that need to be worked on.
Deal with these issues before you put your Amazon business for sale.
Work on every weakness before you sell instead of letting buyers kill your price by spotting the shortcomings.
Last but not least, you will see new strengths of your business during this process, and you should include those in your business sale marketing copy.
Make a value estimate
No one knows if the prices will go up or down. The market is unpredictable, and that’s something we all need to reconcile with.
Numerous factors have a role when it comes to your business’s value.
These are the most important ones that you need to consider if you want to make a value estimate:
- Age. The older, the better (it means that the business is well established).
- Niche. Not all niches and areas are popular, meaning some business types sell better than the rest.
- Products. Does your business have one popular product, or does it have many successful products that have raked in decent revenue for you?
- Brand image strength. The more popular the brand, the easier it is to sell it.
Write a good proposal
To get a reasonable offer, you must have a profitable business with much potential to grow.
However, if you can’t put its strengths into words and communicate them, you won’t get great offers.
That’s why you need to write a good proposal. The proposal needs to list the benefits and ways your business can bring success to its new owners.
So, design an outline first. You need to outline the information you’ll include. Then, describe the business, its customers, rivals, and the overall market.
Also, show your financial data since the buyers will want to know how much they can make each year.
Include a balance sheet detailing its revenue, equipment, inventory, contracts, and real estate.
Of course, don’t forget to tell your prospects what you want for your business. In other words, go for a specific price and don’t go much lower than that.
To make this step more manageable, the best idea is to find a suitable proposal template. This will ensure that you put in all the necessary details and your proposal will look professional.
Don’t forget about supplier contracts
As an online business owner, you are probably aware that supplier contracts can make a world of difference between a business garnering dozens of great offers and a business receiving none.
Remember, when you put your business on sale, your supplier has no relationship with the new owners.
In some scenarios, suppliers will not feel obliged to offer them the same price or even work with them in the first place.
So, try to agree with your suppliers (in writing if possible).
If your business has a great deal with its suppliers (has a significant margin), try to ensure that you can transfer the deal to a new business owner.
In other words, lock down your deals with suppliers. That way, you won’t have to fear that your buyer will pull out and leave the negotiations.
Set a minimum sale price
Be mentally prepared for exhausting and lengthy negotiations.
Usually, it takes a long time to negotiate the terms if you set the price high. And you want to do that if you believe that your business is valuable enough.
Do not forget to set a minimum sale price that you will not go below!
Don’t let them downgrade the value of your business so that they can get a better deal out of you.
Remember how hard you have worked for it, and don’t settle for less than the minimum price you have determined.
Sometimes, it gets tempting to lower the price, especially when the negotiations become exhausting and dull.
So, setting the limit right away will help you eliminate the offers that are not worth your time.
This will also let the buyers know what they should bring to the table and what they will have rejected right away.
The bottom line is that you don’t want to waste a prospect’s time. But they should not waste your time either.
Once you secure a good deal, don’t splash out on anything too fast.
Your buyer has paid a reasonable price, and you should be there to ensure a smooth transition.
The contract needs to have a clear language to signal if you will be available for random phone chats, emergencies, or texts.
Remember, you didn’t get rid of your business; you sold it. If you receive fair treatment, you should provide fair treatment, too.