Gain Profit with an Amazon FBA Brand in the Blankets Category – 34% Margins, Simple to Operate, No Warehouse or Employees Necessary
This clothing company specialises in high-quality blankets which can be personalised with messages for loved ones. The recipient-oriented products are a hit as gifts and sell well on Amazon, with the brand earning several of Amazon’s Choice Badges for the keywords related to the category. The company’s reputation is excellent with thousands of positive reviews, and they enjoy an average lifetime value of around $40, with a $29 average order value. The strong brand and high level of customer satisfaction makes it an attractive prospect for growth, with plenty of potential to expand territorially.
OPERATIONS
As the name suggests, this business is run entirely through Amazon FBA, eliminating the need for a warehouse or employees to keep the operations simple and straightforward. The owners source the goods from a supplier, and they are listed on Amazon Prime. Although advertising has been minimal so far, implementing PPC ads on Facebook and Google and working with social media influencers will open new channels of growth and opportunity. It’s been developed in a way that the workload for the owners is only ten hours per week.
Most of the company’s activities are taken care of by Amazon FBA, such as fulfilment and shipping. The supplier takes care of the majority of the other activities related to procurement of the products from the supplier directly. The company operates without any warehouse space or employees.
MARKETING AND KEY METRICS
As of now, the company spends around $10 per day, per SKU, on Amazon PPC. They could expand into other advertising channels such as social media and Google Ads, to build brand awareness and reach new customers. The company has a strong reputation on Amazon, with thousands of positive customer reviews.
The company has so far focused solely on Amazon, but there is potential to expand to other channels like having their own e-commerce website and selling wholesale to retail outlets such as Walmart and Target.
The company enjoys impressive 34% profit margins, with an average order value of $29 and produces an average lifetime value of $40. It’s winning many of its customer’s hearts and gaining recognition on Amazon as proven by the badges and reviews they have accumulated.
The core customers for this business are those who are interested in personalized gift items, and people looking to purchase high-quality blankets. They have thousands of devoted customers who have embraced the customisation of their products, which can be built upon with targeted advertising campaigns and expansion into other marketplaces.
BUSINESS MODEL & RESOURCES NEEDED
The founders are the sole employees of this organisation, but they would require to hire freelancers like a designer and sourcing agent when necessary, and hire new staff once the company grows.
THE INDUSTRY
The industry of this company is E-commerce. This is a blanket company which operates using the Amazon FBA platform to offer their wares to customers all over the world. It’s an industry that has been trending for years, with many exciting companies seeing explosive growth and taking on traditional brick-and-mortar stores. Amazon FBA brands continue to be one of the most attractive investment victims in the industry due to their scale and scalability.
OPPORTUNITIES TO SCALE
The first scale opportunity this company could pursue is expanding its existing range of products beyond blankets, possibly adding pillows and other decor to line. The owner could develop an Amazon marketing campaign, establish themselves on other international Amazon markets while pursuing opportunities to gain customers from additional sales channels. They could add subscription bundles, improving SEO and generating more sales, improving their existing sales channels, and add more products a well as build a Shopify store to access customers outside of an Amazon marketplace.
Asking Price: $575,000
Gross Income: $377,337
Cash Flow: $134,675
Year Established: 2019
Employees: 2
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