Dropship store in the Outdoor Sporting Goods industry
| Asking Price: | $899,000 |
| Established Year: | 2017 |
7.5 Y/O eComm site with its own private brand name making ~$19k monthly net prof
This 7.5-year-old eCommerce store isn't going to stay on the market for long, given the fact that it ticks ALL of the boxes serious buyers care about... and then some! Here are the top 10 things you need to know about this attractive business...
1. Aside from the private-label products the owners have built, everything is drop-shipped. This means you don't have to purchase products from suppliers until after you've made a sale and collected the revenue, eliminating the need for a) working capital, b) warehousing & overhead costs, and c) the risk that you purchase inventory you're unable to sell. Despite the fact that almost all orders are drop-shipped…
2... the business averages a very solid 26.1% gross profit margin. Very rarely are you able to find a business that has such high profit margins on drop-shipped products that also…
3... have a ~$1,250 Average Order Value (AOV). (In our experience brokering eCommerce stores for the past 10+ years, most high-ticket drop-shipped products have more modest 10-15% margins, sometimes even lower.) Because of this killer combination of a 26.1% gross margin and a $1,250 AOV, the store manages a very cool…
4... ~$325 Profit Per Order (PPO). "Yeah, but how much of that is eaten up by advertising costs?", you ask. Not much! Advertising expenses are a mere 4.2% of revenue. And yet, despite the fairly low marketing costs…
5... the store averages over 69,000 visitors per month, almost 2/3rds of which come from free traffic sources (primarily organic search traffic). This insane amount of traffic is made possible by the site’s…
6… thousands of #1 / top 3 / top 5 / top 10 Google rankings for targeted search phrases (i.e. keyword phrases), most of which demonstrate a high intent to buy. Per Ahrefs.com, the site has 492 "top 3" rankings (with a combined monthly search volume of 24,650) and a whopping 2,567 "top 10" page 1 rankings (over 150,000 searches/mo). With these stellar rankings, the store averages over 31,000 visitors per month from organic search traffic alone. This doesn't even count direct traffic (10.3% of total traffic), free organic Google Shopping traffic (6.6%) or free organic social media traffic (2.1%). Four of the top 5 traffic sources are completely free!
7. Aside from the post-COVID "hangover" year 2022, revenues have increased every year since the business was created 7.5 years ago (May 2017). The business has done ~$10 million in revenue over its lifetime, with over $1.7 million in revenue over the past 12 months (Nov 2023 - Oct 2024).
8. The store has generated ~$225k in net profit over the past year, which yields a $18,743 average monthly net profit. Given the nature of the products (outdoor sporting goods), there is some seasonality... but not as much as you might think. Only 2 of the past 12 months had net profit below $15,000.
9. The two owners (friends who created the business together 7.5 years ago) each spend less than 15 hours per week in a high-level supervisor role on running the business. This is made possible by the fact that they have two very experienced and well-trained Virtual Assistants (VAs) that handle all of the day-to-day operations of the business, including sales/customer service, maintaining the store catalog, writing content, email marketing, and preparing reports for the owners to review.
10. The owners currently have a) LOTS of cash sitting in the bank and b) a 30-year SBA loan for about the same amount (i.e. current balance of ~$299k). This presents an opportunity for a unique deal structure IF you're interested (the deal certainly doesn't have to include the SBA loan - it's entirely up to you). If desired, the deal can be structured such that the buyer assumes/takes over the SBA loan (which has a very low 3.75% per annum fixed interest rate and monthly payments of only $1,590). You could either take over this loan at this incredibly low interest rate, or the seller can pay it off. The choice is yours.
