E-Commerce Automotive Performance Modification Retailer with Dropship Inventory Model
This eCommerce business in the Auto Parts & Tools vertical focuses on the Performance Modification of Cars and Trucks, offering an array of auto parts that are in high demand among a car-dependent customer base.
OPERATIONS
The company’s products, which include parts for brakes, exhaust systems, gauges, belts, and fluids, are wildly popular with do-it-yourself (DIY) customers. The company generates 99% of sales via the Amazon platform and orders through Amazon are fulfilled directly by the supplier, which ships the items straight to the customer. With over 170,000 SKUs available and an average order value of $197, their sales remain consistent throughout the year. All customer service duties are outsourced to VAs with one GM overseeing all daily activities.
All products are ordered through Amazon and are fulfilled directly by the supplier, which ships the items straight to the customer. This means the company holds zero inventory and pays no fulfillment or storage fees to Amazon. Tight relationships with multiple domestic suppliers and expertly negotiated, rock-bottom prices allow them to regularly win the Amazon Buy Box.
MARKETING AND KEY METRICS
The company could benefit from a well-planned digital marketing strategy. Up until now, the business has relied solely on price point to drive sales, but a strategy utilizing Business Facebook page, Instagram account, and DIY-catering blog can be effective in developing customer relationships and interactions, as well as powering up a stronger online presence for the business. Paid media could help grow sales on both the company’s Amazon platform and its website.
Launched 4 years ago as an eCommerce website, this brand has expanded beyond their proprietary website and now generates 99% of sales via the Amazon platform. This company could benefit tremendously from a digital marketing plan and the potential growth of the company is limitless.
Their top selling product represents just 1.7% of total sales with no hero SKUs, leading to massive sales diversity and extremely low risk. The company typically sells over 125 parts per day. With no inventory to store and no warehouse needed to store it, working capital requirements are non-existent and overhead expenses are minimal.
Their customer base spans across all age groups, races, and income levels – literally, anyone who drives a car and needs parts for it.
BUSINESS MODEL & RESOURCES NEEDED
This is a hands-off business for the Seller with all customer service duties outsourced to VAs. There is also one General Manager that oversees all daily management activities. This is a simple business and an easy one to learn, especially for a buyer who has any eCommerce experience.
THE INDUSTRY
The global market for auto parts surpassed $390 billion in 2020 alone, driven by the desire among auto drivers to enhance their vehicle performance in terms of sound, speed, appearance, and safety. Environmental rules regulating noise emission levels as well as air pollution standards are also contributing to rising auto part sales across the country.
OPPORTUNITIES TO SCALE
This company has a massive customer base, strong sales trends, and has built a reputable name for itself. The new owner would have endless avenues to succeed and unbridled capacity for company expansion. Paid media could help grow sales on both the Amazon platform and the website. Further outreach could provide organic traffic opportunities.
Asking Price: $2,250,000
Gross Income: $9,398,732
Cash Flow: $539,949
Year Established: 2017
Employees: 1
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