A SellerForce offering, this company is a unique, highly profitable, and established business that holds the #48 Best Selling ranking in Amazon for the Sports & Outdoors Category. Residing within the largely uncompetitive private label Cycling parts market, this brand ships and sells 36 SKUs of premium Cycling inner tubes all over the United States.
This well-established business sports 15.25% net margins and a inventory turn rate of 3.9 months creating an impressive 46.92% Return On Working Capital. Even during the surge of COVID-19 last year, this company has managed to remain successful in this large niche due to the demand for a premium inner tube when most of the existing market is wholesalers of an inferior product on Amazon.
Speaking of COVID-19, the pandemic wreaked havoc on supply chains across the E-commerce space, however this operator, whose sole income rested on this business, managed to keep the operation cash flowing while supporting his family by focusing on the fastest turning SKUs the supply chain could deliver under COVID conditions.
This creates an opportunity for a savvy investor who understands supply chains and can inject working capital to build on the premium positioning to expand existing SKUs available and scale the current best sellers to their potential that was only limited by working capital.
The revenue seen from this brand so far is only the tip of the iceberg. The immediate growth opportunity is obviously increasing inventory of the proven, profitable 36 SKUs and their associated Amazon PPC campaigns. Expansion into other consumable Cycling SKUs such bike chains and sprockets to market to the 5-year-old 17,000+ Instagram following and customer list is another strategy to build on this premium brand.
As inventory of existing SKUs and their proven advertising campaigns are scaled by the next operator, organic rankings within Amazon’s A9 search algorithm will likely elevate creating a self-reinforcing virtuous cycle of expanded top line revenue and bottom-line profit margins.
The bottom-line up front is you are acquiring an established premium brand with 36 proven SKUs in a single category within an expanding niche whose growth was only limited by working capital.
Listing Number: SF22
