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{"id":719,"date":"2021-12-26T10:00:42","date_gmt":"2021-12-26T10:00:42","guid":{"rendered":"https:\/\/www.ecommerceaggregators.com\/?p=719"},"modified":"2022-04-25T09:43:18","modified_gmt":"2022-04-25T08:43:18","slug":"double-growth-amazon-fba-valuations","status":"publish","type":"post","link":"https:\/\/www.ecommerceaggregators.com\/double-growth-amazon-fba-valuations\/","title":{"rendered":"Double Bubble: The Growth of Amazon FBA Business Valuations"},"content":{"rendered":"

So, this is Christmas. And what have you done?<\/p>\n

Well, if you’re like many other Amazon FBA<\/abbr> business owners, you’ve run yourself ragged for a month. Or, more like, you’ve not stopped since COVID hit.<\/p>\n

Some will look back on their income and say it’s all been worth it. Fair play; some owners love being constantly connected to their customers.<\/p>\n

Others \u2014 up to as many as 80%, according to one report \u2014 don’t own a pair of those rose-tinted glasses. Checking their store over Christmas Day dinner? No thank you.<\/p>\n

But, what options do you have when you’ve put so much into building an Amazon store, but now want rid? It’s not like you can sell your Amazon FBA business as a going concern, is it?<\/p>\n

Actually, you can. And it’s easier and perhaps more profitable than you might think.<\/p>\n

Why now might be the time to sell your Amazon private label business<\/h2>\n

Prior to 2020, selling Amazon businesses appealed to a tiny market. Hidden behind private equity dealers, few merchants even knew it was an option. That’s changed, and some.<\/p>\n

Amazon aggregators<\/a> have forcibly moved buying FBA businesses into the ecommerce mainstream. By doing so, they’ve increased the competition.<\/p>\n

This new visibility has tempted investors, who’ve since funded Amazon aggregators to the tune of billions<\/a>. Now, across the globe, there are getting on for 100 active such businesses.<\/p>\n

At the beginning of the curve<\/h2>\n

Experts, based on history, suggest that there’s a natural arc for this type of investment. They’re probably right. But, right now, it’s early days. We’re still at the beginning of that forecast trajectory.<\/p>\n

The expectation, therefore, is for the number of aggregators to double in 2022. So, good news; there are no signs of slowing just yet.<\/p>\n

How the price of Amazon FBA businesses has grown<\/h3>\n

Marketplace Pulse has researched the market<\/a> now that there’s enough data to make data meaningful. If you sold your Amazon business in the early days, you might want to look away now.<\/p>\n

Two years ago, you’d have typically realised 2.5-to-3 times your Seller’s Discretionary Earnings (SDE) in a buy-out. So, if you earned $500k a year, you could expect an offer between $1.25-$1.5m.<\/p>\n

Back then, your FBA earnings were pretty much the sole yardstick by which buyers valued your business. Sundries like add-backs and expenses did contribute, but marginally.<\/p>\n

Digging deeper into your proposition<\/h3>\n

Today, buyers look at many other factors about your business before making an offer<\/a>. In an extension of a basic SWOT<\/abbr> analysis, they will take into account:<\/p>\n