TAS 111 How To Buy and Sell Profitable Amazon Businesses (Step by Step)

You’ve heard of house flipping. And possibly you’ve heard of website flipping. Well in this episode we’re talking about at potentially new way to flip Amazon businesses, or just sell one you already own. Today Scott is chatting with a previous guest, Ty Rooney about an idea Ty has come up with to create a website interface to allow buyers and sellers of Amazon businesses to come together, exchange information, and consummate a sale of an already existing, profitable private label business on  Amazon. It’s an amazing idea… very appropriately featured on this episode of The Amazing Seller!

Ty Rooney’s built his own private label business and is helping others build theirs.

Ty was featured back on episode 33 of The Amazing Seller as an up and coming private label business owner and his business has taken off since then, just as he expected. But as he was building out his business he had another idea: help companies with existing products get their products on Amazon. He’s discovered a great niche and his expertise with the Amazon Seller Central interface has enabled him to work up to 20 clients whose accounts he manages. It’s that expertise that’s led him to consider this another new idea: helping Amazon sellers sell their businesses to interested buyers. It’s a great idea… one you’ll hear about in detail on this episode.

Why would you want to sell a profitable Amazon business?

The steady cash flow of most profitable Amazon businesses makes them a very desirable type of business to have. So why would you want to sell one? There are many reasons. Though you can streamline an Amazon business like no other, there’s still some work involved in reordering products, etc. It may be that an Amazon seller simply gets burned out and wants to try something different. Selling their business could be a great option… and there are plenty of business people out there who are eager to invest in businesses with a proven track record of profits. Ty Rooney and Scott Voelker have assembled a team of people who are working toward an Amazon Business brokerage that would help buyers and sellers make those deals happen. You can hear all the details by listening to this episode.

What is my Amazon business worth if I wanted to sell it?

Naturally, there are many variables to determining how much any business is worth. And the Amazon model is still new enough that there’s no established track record of business sales to go by. But Ty Rooney has been doing his homework to work toward an Amazon business broker site and believes that the average Amazon business that is profitable could likely sell for at least 20 times its monthly net. So an Amazon private label sales business that is bringing in $2,000 a month could potentially sell for $40,000 or more. Do you see the possibilities? Ty has lots to share on this episode so be sure to listen.

Buy an already profitable Amazon business that is fully vetted by experts.

That’s one aspect of the idea Ty Rooney has for his Amazon business brokerage. Since he and his team are experts on how the Amazon Seller Central platform works, they would investigate the numbers on every business that is submitted for sale through their site. That way every claim made by a business owner about the profitability and track record of their Amazon business would be verified by an independent 3rd party. Buyers would be assured that the numbers they are hearing about their potential business purchase are accurate. Can you imagine the potential for this idea? Find out more on this episode of The Amazing Seller.

OUTLINE OF THIS EPISODE OF THE AMAZING SELLER

  • [0:03] Welcome and introduction to this episode… selling and buying profitable Amazon businesses, with Ty Roney.
  • [1:08] Shout out to the TAS Facebook Community member Christina Koontz Antsworth!
  • [4:28] Welcome to Ty, and Ty’s thanks to Scott for his help.
  • [5:52] An update on Ty’s story as an Amazon seller and running of an agency to help others sell on Amazon.
  • [13:19] Ty’s new idea of selling Amazon businesses to those not wanting to find products and set up the interface.
  • [16:40] Scott’s comparison of house flipping and how it applies to reselling an Amazon business.
  • [17:44] What could you expect a person to pay for an Amazon business? 20X your monthly net.
  • [19:15] How this model might compare to selling other types of businesses.
  • [29:56] The announcement of a new website for the sales of Amazon businesses.
  • [22:55] How people who can build out authority websites to attach to their Amazon business could use the platform.
  • [24:09] Who might want to use this service?
  • [26:45] Why Ty is excited about this type of business and the advantages he sees for those wanting to buy an Amazon business.
  • [29:06] An example of what a business purchase might look like.
  • [32:06] The one big piece the Jungle Flippers site would provide. Vetting the sellers.
  • [34:19] How the site would work for people interested in shopping businesses.
  • [39:00] Scott’s summary of the episode.

LINKS MENTIONED IN THIS EPISODE

The previous episode Ty Rooney was on www.TheAmazingSeller.com/33

The prototype Amazon business website: www.JungleFlippers.com

Get information about this ideas: www.JungleFlippers.com/info

Scott’s free workshop  – http://www.TheAmazingSeller.com/workshop

www.TheAmazingSeller.com/FB – the TAS Facebook Community

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22 comments
  • Hello Scott!
    I have a sellers account in Amzon and I have about 600 units in stock. Now I just want to sell this stock and account and even FB account related to this business. Any ideas how to do it now? Actually I don’t expect a lot from such bargain just want to cover some expences.

  • Scott,

    If I had a Amazon business doing about $125k/mth about 30-40% profit. If we take the 40X sales could I get around $4 million for this business. We are growing monthly with 10-20% repeat customers and also have 4.5 star average review ranking across our entire products. We are about to go into certain boutique shops with same or higher margins with the potential to grow that part of the business itself to 100k-250k a month. Just been extremely busy just keeping up with products. At that growth rate and possible future revenue could I get more? What would you think with that limited information?

    • Hey Jay, your best bet may be to reach out to someone like Ty who is more of an expert in the resale of these types of businesses to see what they think!

  • If you already have a seller account, how does this work? Can you just buy someone else’s brand/products and sort of add them to your own account? Does amazon let you migrate the inventory and all that over to your account?

    • Hey Davis, since listings are technically owned by Amazon, you could just put all the inventory under your account. Additionally, you could buy the entire Amazon account (as a part of the business) and take it over with out much hassle.

  • Are there any step by step guides to selling just one of your products/brands? It seems like you would just create a removal of inventory to the buyer, have them set up an account and use the same listing right?

    • Hey Joe, if you have multiple brands in the same account, it sounds like your strategy would work. If you only have the one brand, you would be able to turn the entire seller central account over.

  • I emailed Jungle Flippers a week ago and never got a response. Guess they’re being slammed or else not quite up and running yet.

  • Scott,
    I enjoyed hearing about the new website/business.
    But I would love for you to revisit this topic with some more actionable tips for us that are just in the starting phase of building an amazon business. What should we be doing now to set us up to sell for max profit in the future? Thanks again.

    • Hey Eric, if you’re looking to sell the business, the only thing that would really change is that you would want to invest even more of the profits back into the business to grow your sales numbers at a faster clip.

  • A 12% commission on the sale (info on their website) is pretty hefty I think. Just imagine a sale for 200 grant, that would equal 24k for the plattform!

  • I’m with you on the burnt-out.=) I’d gladly sell our successful Amazon business for 40 times net. It’s been a great time, but most days I walk around in a daze. This year our Amazon business (including vendor central) almost doubled. With a small warehouse and small staff, keeping up has been very challenging. Selling the business would let us take a couple years off, pay off multiple mortgages, and still have enough left to jump back in several years from now (in a different category).

  • I love this podcast, but this episode just felt like a 40 minute ad… it’s probably my least favourite episode so far, for that reason.

    Keep up the good work

    • I agree, I have listened to every episode since the beginning and love them all, and this one felt like the moment the TAS podcast jumped the shark. It was like two Amazon sellers getting together trying to figure out how to make money off this FBA thing before it goes away as we know it.

      Hate to be negative, I love the podcast and am a huge Scott fan, but this one didn’t sit right.

      • Hey Paul,

        I’m sorry you feel that way! With businesses looking to acquire private label brands, this buisnesss model is likely to emerge within the ecosystem. It’s something that will happen as any market grows and matures, look at the app market place (where companies like apple and google snap up start up companies left and right) or the website space (where there are several markets and people build sites specifically to sell on those markets), it’s a natural next step for some of the people in this space.

        I do hope you continue to listen!

  • Great Idea. Will there be some sort of rating system that measures growth potential, competition, re-stocking costs, relationship with vendor, ect. I’m thinking something along the lines of having a base rating and providing the stars as a quick reference for the potential buyers browsing business. But this would also give future sellers an idea of what parts of their business they need to work on if they plan to be a seller.

    • Hey Mike, those are all great options! Some of that would vary from buyer to buyer in terms of what they want to see, but there is a great amount of information that could be used that way.

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