Where To Buy Ecommerce Businesses (Already Making Passive Income)

Summary

In this video, the presenter discusses the two key factors for e-commerce business success: product-market fit and scalability. He emphasizes the difficulty in achieving these and critiques the oversimplified portrayal of starting online businesses. Instead of starting from scratch, the video suggests buying existing, profitable businesses from reputable website brokers such as Empire Flippers and FE International. It provides examples of businesses for sale, their earnings, and the amount of work required. The presenter also shares a free due diligence framework to help viewers make informed purchasing decisions and avoid risks.

Takeaways

• 😀 Achieving product-market fit and scalability is crucial for e-commerce businesses, but it's often harder than expected.
• 😀 In 2019, a study by the Small Business Administration showed that 90% of startups fail, highlighting the difficulty of starting a business.
• 😀 Buying an established e-commerce business with a proven track record of profitability is a viable alternative to starting from scratch.
• 😀 There are many e-commerce businesses for sale that are already generating passive income, making it easier to step in and run them.
• 😀 Website brokers are the best place to find online businesses for sale because they have reputations to protect and vet the businesses they list.
• 😀 Popular website brokers include Empire Flippers, FE International, The FBA Broker, Quiet Light, and Exchange Marketplace.
• 😀 Exchange Marketplace allows Shopify site owners to sell their businesses directly, though caution is required due to potentially dodgy listings.
• 😀 To buy an e-commerce business, check the asking price, monthly net profit, and the multiple (price = average monthly profit x multiple).
• 😀 Some businesses for sale, like an FBA supplement business, can be bought for around $72,000 and require only 2 hours of work per week, yielding a good hourly return.
• 😀 Always conduct due diligence before purchasing an e-commerce business, and consider using a proven framework to guide the process.
• 😀 The speaker offers a free due diligence framework that helps buyers make informed, smart investment decisions when buying an online business.

Q & A

What are the two key factors for an e-commerce business to be successful?

The two key factors are product-market fit and scalability.

Why is it difficult to achieve success in e-commerce according to the script?

It is difficult because many people underestimate how hard it is to achieve product-market fit and scalability in an e-commerce business.

What is the failure rate of startups, according to the study from the Small Business Administration?

The study from the Small Business Administration showed that 90% of startups fail.

What alternative to starting an e-commerce business does the speaker suggest?

The speaker suggests buying an existing e-commerce business that has already found product-market fit, is scalable, and has a proven track record of making money.

What are some platforms the speaker recommends for buying e-commerce businesses?

The speaker recommends platforms like Empire Flippers, FE International, the FBA Broker, Quite Light, and Exchange Marketplace.

Why does the speaker recommend using website brokers to buy e-commerce businesses?

Website brokers are recommended because they have their reputation at stake and will not list just any business for sale, thus reducing the risk of purchasing a poor business.

How does the price of an e-commerce business get determined?

The price of an e-commerce business is determined by multiplying the business's average monthly net profit by a multiple.

What is the average hourly rate when investing in an e-commerce business based on the example provided?

In the example of a business making $2,141 in net profit per month with only 2 hours of work per week, the hourly rate would be $2141 divided by 8 hours, which equals approximately $267.63 per hour.

What return on investment can be expected from a subscription box business listed by FE International?

The subscription box business is expected to provide more than a 50% return on investment per year, as it generates $128,000 in net profit annually.

What additional due diligence tool does the speaker offer to help potential buyers of e-commerce businesses?

The speaker offers a free due diligence framework, which can help buyers make informed investment decisions by asking the right questions about a business before purchasing.