FBA Store in the sports fan merchandise niche with 50% year on year growth successfully sold on Flippa.
About the Business
Licensed Fan Gear is a 3-year-old FBA store started by Michael, a seller based in the U.S. When Michael listed the business for sale on Flippa it was generating a steady monthly revenue of $12K with a profit margin of 34%.
The Amazon FBA store resells professional and college sports licensed fan gear. Products range from team flags, lanyards, sleeping bags, backpacks, beach towels, hats, and more, and are purchased at discounted rates from wholesale and overstock suppliers nationwide with some items imported directly from manufacturers overseas.
The company sells items that are in brand-new retail condition, and some inventory is purchased online and in-person auctions.
The Appeal
At the time of sale, Licensed Fan Gear had a 98% positive rating on Amazon and held approximately 130 FBA items.
After 3 years of operation, the business generated $150,000 in revenue, and despite the lack of in-person sports events and tailgating, sales grew by 25% in 2020 and during the first 8 months of 2021, sales were up by 64%, a period of time when Michael was on vacation, a testament to the lucrativeness and passive nature of the business.
The business has contracts with suppliers nationwide, most of them based in the U.S., in which the company purchases its goods at a discounted rate and primarily generates its revenue based on a dropshipping model.
Additionally, the business has digital assets such as product photos and various software programs that determine the competition and maximize the profitability of each SKU (stock-keeping unit).
The Selling Journey
As other businesses turned into a full-time venture and Licensed Fan Gear grew at a rapid rate, Michael decided to sell.
Besides the business being suitable for someone interested in professional college sports or looking to diversify their FBA portfolio, at the time of sale, the FBA store had excellent potential to rapidly grow.
“The business can grow even more with a buyer putting more time and effort into sourcing new ASIN’s and optimizing the advertising programs,” Michael advises.
Ultimately, the business was purchased by a serial entrepreneur looking for businesses to add to his portfolio of assets.
Michael has agreed to support the buyer to ensure the continued success of the business, providing post-sale support.
“We will teach the buyer the software programs we use, introduce them to the suppliers, and explain all we know about how to work with Amazon to maximize sales and profits,” says Michael.
There’s a lot to learn when purchasing a business so the post-purchase support offered by Michael is invaluable for the new owner. The former business owner will understand what works and doesn’t, and while all new owners will have ideas on how to grow the business it’s always important to learn about past successes and failures.
Needless to say, the buyer is in good hands.
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