In less than 30 years, Amazon has gone from a small online bookseller to a massive conglomerate with dealings in groceries, cloud computing, physical retail, video games, and more. It redefined what is possible in the retail world and beyond, and if you’ve been selling on Amazon for some time now, you probably know all there is to know about it.
However, you’ve come to a point in your life when you want to move on to something new and exciting and probably found yourself typing how to sell my Amazon business the right way on Google. If you still haven’t found the right strategies to sell your business, we’ve come up with four steps to guide you through the process.
Get your information in order
Before you start thinking of ways to sell your Amazon business, you’ll need to gather some important information so that you can present it to professionals and potential buyers. This would also be a great time to start thinking about sales development, as it focuses almost exclusively on the early stages of the sales process.
It’s a combination of people, processes, and technology, which will help you figure out who you want to sell your business to, whether it’s someone interested in your service and product or a complete stranger. Keep in mind that the entire process of buying and selling an Amazon business depends far more on the numbers and how you’ll present them. Take the time to go through your finances, deal with taxes or any additional records, and decide whether you want to share information about how your business succeeded.
Determine the value of your business
The next step would be to determine what value to list your business for through your broker. It may not be an exact number, but a range you can negotiate from. In addition, you won’t have to come to a final number yourself, but you can work with your broker to come up with a suitable figure. However, note that business valuation in practice is quite complicated with plenty of other factors involved, so make sure you start with the SDE (Seller’s Discretionary Earnings).
This is the amount of money that remains after all the core expenditures have been accounted for and it’s generally a multiple of the starting value for selling a business. You can start with the SDE for the past 12 months, given how rapidly things change on Amazon, your recent earnings will have a greater weight than one might expect. Things that can affect the value of your business include growth opportunities on Amazon and outside of it, brand ownership, trademarks, and copyrights owned, the age of your business, and many more.
Consider the cost of selling and working with professionals
Paying brokers and other professionals to help you sell your business is quite reasonable. However, there are also other types of fees, taxes, and more to consider. Note that when you tally them up, you could be taking away a bit less from the whole process than you might expect. Some of the significant costs you should consider include broker fees, legal fees, and taxes. Additionally, you should set a target or minimum sell value and make sure you don’t sell below that. You’ll have to be reasonable about this, so it would be best to consult with experts.
One thing that’s absolutely important when selling your Amazon business is having a broker or brokerage firm work with you. Even if they take a fee, they’ll know how to negotiate, how to handle the legal side of things, how to best evaluate your business, and how to market it. Furthermore, you’ll need to know what to look for in a broker if you want to find a suitable one. Qualities you should always look for include professionalism, confidentiality, communication, experience, and previous results.
Prepare marketing materials and talk to potential buyers
Think of selling your business the same way as selling a property such as your home, car, or any other high-value asset. You need to create marketing materials, although if you’re working with a broker they’ll be able to help you with all of this. Make sure you cooperate with them and provide them with all the information they need and answer any questions they have. Furthermore, ensure that you’re communicating with potential buyers, which can aid your marketing efforts.
Your potential buyers will need to sign a non-disclosure agreement (NDA) before you allow them to look at your business in any detail beyond a brief description. Keep in mind that even if you’re an expert at marketing your products and services, you’re likely not an expert at marketing businesses for sale, so make sure you work with professionals. Once your listing is up, your main job would be to communicate with potential buyers, if they’re serious about purchasing your business, and answer any questions they might have.
Final thoughts
Selling a business is no easy feat. You need to research thoroughly to find out all there is to know so you can successfully make a profit from it. Don’t forget to inspect your business before selling to ensure that the buyer will be happy with what they’re getting. Prepare an asset purchase agreement, and be ready to close the deal.
