Expanding Ecommerce Wine Racks & Accessories Brand with International Sales
This eCommerce business offers a wide range of wine racks that are significantly superior to the competition and designed to last a lifetime. With a strong focus on timber sustainability, the business is FSC certified and the only wine rack provider globally with this certification. The business has grown rapidly since its establishment in 2015, with international sales channels and strong YOY growth. The typical customer is split evenly between men and women with high-income demographics, and sales are consistent throughout the year, with peaks approaching Father’s Day and Christmas.
OPERATIONS
The company operates 3PL facilities in New Zealand and the U.K., and its supplier produces products specifically for the brand with signed exclusivity agreements. Each product is manufactured in China using 100% FSC Certified New Zealand timber and shipped directly to the Australian, New Zealand, or U.K. facility. The business is set up to be defendable, with the main requirement for growth being the capital to purchase stock to satisfy demand and the ability to set up 3PL operations in more locations.
The business has full supply chain certifications, and FOB pricing with some smaller suppliers domestically and internationally for accessories. The supplier produces products specifically for the brand, and exclusivity agreements are signed and in place. The business has operational 3PL facilities in New Zealand and the U.K. and is transitioning to a 3PL in Australia at the moment, which will reduce the amount of rent as payment.
MARKETING AND KEY METRICS
The business sells through various B2B channels, including some major players, and has enormous potential to dominate the U.S. market by setting up a 3PL in the country. The brand also sells on Amazon Australia and has several opportunities to leverage other sales channels, including affiliate marketing, secondary sales channels, and influencer marketing.
Continuing what the company already does and growing the client base will create steady growth. The company’s business model lends itself well to variety, as it can be effectively replicated to branch out into new verticals, such as food, vitamins, or hygiene products.The business has ample opportunities for growth in sales channels, including but not limited to, tapping into digital advertising beyond SEO and AdWords, affiliate marketing, secondary sales channels, influencer marketing, and retail and wholesale channels. Specifically, the business already sells on Amazon Australia, which only constitutes a fraction of its revenue. If the storefront is outsourced to an experienced agency or a new owner with Amazon expertise manages it, the brand can quickly scale globally by establishing itself in lucrative markets like the U.S., Canada, Europe, and parts of Asia.
The business has enjoyed strong YOY growth, with a gross income of $1,681,908 and a cash flow of $558,585 in the latest financial year. The typical customer is split evenly between men and women, and most are from high-income demographics. The repeat order rate is high, and sales are consistent throughout the year, with peaks approaching Father’s Day and Christmas.
The typical customer is split evenly between men and women, with most from high-income demographics. They buy wine racks based on their quality and longevity, making the business’ unique value proposition especially appealing. The business also enjoys a high repeat order rate, even as it grows explosively.
BUSINESS MODEL & RESOURCES NEEDED
Besides the business owner, the company employs a customer service agent, a full-time and a part-time designer, who both work as sales reps additionally, and two warehouse staff. The warehouse work is being transitioned to a 3PL, resulting in a fully remote team.
THE INDUSTRY
The wine industry is a rapidly growing industry and is expected to reach over $444 billion by 2027. As consumers’ interest in wine and wine accessories grows, niche products like wine racks see strong growth as well. As sustainability becomes more critical for consumers, the use of eco-friendlier materials like FSC Certified timber also becomes more common. Competitors in this business’ industry include Wine Enthusiast, Wine Racks America, and Vintage Cellars.
OPPORTUNITIES TO SCALE
A strong capital injection can take the business to the next level, as it needs to purchase more stock to satisfy the demand and set up 3PL operations in more locations. Additional scale opportunities come from expanding to additional sales channels like Amazon, digital advertising, and retail and wholesale channels.
Asking Price: $2,520,000
Gross Income: $1,681,908
Cash Flow: $558,585
Year Established: 2015
Employees: 5
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