I got the business!
Not without Shopify getting their cut of course.
So I did it! After a couple of months of looking, evaluating, awkward video calls and research, I finally closed on a business.
Here’s what I got.
The Copper Pot Co.
How I Found This Business
True story, I started my search at the very beginning with a google query. I believe I typed “ecommerce business for sale” and went from there. After reviewing a few sites, I ended up at https://exchangemarketplace.com/ which is the Shopify business marketplace. There are thousands of businesses for sale, many of them seemed to be dropshipping businesses which I wanted to avoid (reasons will be shared in a future update).
My Criteria
I wanted to find a business that hit on a few important elements for me to feel confident I could learn and grow it, points included:
Required
Be a business I could be passionate about. I’m already into copper products as well as being excited about the opportunity to learn more about building a business selling unique artisanal products.
Feels like a brand that can be built on. This means a decent name, with a decent domain name and related social channels. There are many businesses listed that don’t check those boxes, surprisingly.
Good sourcing partner relationships. While I will look for further suppliers as I introduce new products or replenish existing ones, I wanted a supplier I could start with.
Support on transition. I’m new to this, so it’s important that the person selling the business would be willing to support me, so I can learn fast. It’s not uncommon to see 2 weeks transition time as a starting point. For this business, I’m getting a few months, which is very generous.
Fit within budget. I know, obvious. Prices vary greatly, starting from the hundreds all the way to the hundreds of thousands. I was looking to spend anywhere up-to $10k - based on revenue and some other factors.
Bonus Points
Physical inventory. Would be good to start with products ready to sell and ship, giving me time to make some changes to the site, and get up-to speed on all the moving pieces.
Has a social following, meaning, legitimate customers who I can reach out to.
Other Considerations
Site Visitors. The Copper Pot Co has had very little traffic, with no paid media campaigns and only $100 spent on facebook to promote a few posts. What I wanted to avoid was tons of traffic and no traction. By all indications, conversion was already promising based on sales.
Profitability. As indicated on the listing and after looking through the numbers, there’s a roughly 60% margin including shipping. Not bad. I know I can improve on those numbers.
Revenue. The number of sales for this business was low, which was a reflection of the time and money invested in driving shoppers to the site. I think there’s enough niche promise here to build on.
The Process of Buying a Business
I reached out to the owner of the business, and scheduled a call. We chatted, I asked questions, the notable ones included:
Why did you start the business?
Why are you selling the business?
Any legal issues I need to be aware of?
What would you do differently?
Any learns?
After chatting for an hour or so, I got a decent vibe. The owner, Dustin had started the business as a passion project, it made use of his photography skills as well as his passion for copper products. After building it out, sourcing the product and seeing some initial sales, he quickly discovered a couple of challenges.
Shipping is a pain - don’t I know it! I wish he had found ShipHero Fulfillment, however, this is a common pain point for ecommerce, fortunately, I have that covered.
Energy & Time requirements. To make this a legitimate source of revenue would require more time than he wanted to dedicate to the business.
Career Change. 2020 saw a pivot on his career, with more demand for his photography services abroad for a decent portfolio of customers. Apparently he’s quite talented.
What to expect when buying a business according to Shopify.
So How Much Did It Cost?
The business was listed at $5,900. This includes everything, including $1,700 of inventory. I did attempt to reduce the price, Dustin was in no hurry to sell and felt it was a fair price, I relented on the price and got more time for post purchase support.
I used escrow.com to send over payment, and once everything was checked and transferred, payment was provided to Dustin. Shopify took a cut of about $800 for the sale of the business, which was paid by the seller.
Whats Next?
Well, I’m still going through the process of getting this setup. Will be posting a video update to recap that experience in the next week.