Many sellers on Amazon take advantage of this massive platform and successfully run their e-commerce businesses. However, other may struggle and find it hard to have a consistent profits. What are the main reasons?
There are numerous reasons why Amazon business owners decide to sell their companies. One of them is the difficulty to cope with ever-changing and evolving Amazon regulations and other business–running nuances on this site.
As Marketplace Pulse report has noticed, many new sellers and brands are entering the Amazon marketplace, but they disappear after a few months of launching. It happens because of the lack of knowledge about Amazon updates and regulations. Some Amazon sellers find it time–consuming and tricky to deal with all the paperwork, brand registration, management of the finances and accounting among other things while having FBA as a side ‘hustle’.
Another reason why most Amazon FBA business owners find it difficult to run their business is the lack of resources to scale. As third party selling has taken over Amazon marketplace, it has become increasingly harder to find a non-saturated niche to enter relatively cheap. Scaling up to the point of consistent profit requires additional capital. However, not everyone can afford adding new capital for some time to be able to rank among top sellers.
If it has become too stressful and challenging for you to keep up with all the necessities to successfully run a business, other options exist. Some of them would be dedicating more of your time each day, outsourcing some operational work or buying third party service. However, these solutions comes at a cost as well. A time and opportunity cost with the former, and a potential reduction in profit margin for the latter ones. Fortunately, there is one more, rarely considered option: selling your business altogether.
While still a relatively young industry FBA business acquiring is gaining more traction each day, offering sellers a quick and easy way out with a multiple. Important to note that most of the acquirers has revenue thresholds (usually five digit) for businesses or brands that they acquire, putting roadblocks to many potential FBA business sellers and leaving no option, but to seek investments for scaling. Fortunately, there are few players that gives an opportunity for those that fall below standard thresholds. Exit Makers is proud to be one.
No matter the actual reason – whether difficulties to scale, too much time spent, or high demands of ever changing marketplace environment – the decision to let go of your business can be challenging and must be considered carefully with several factors in mind. If you feel ready, Exit Makers are here to assist you in this process!