Baby Products - FBA Success
In 2018, a single mom in Ukraine found that her baby’s pacifiers kept falling out of her baby’s mouth. After searching for a solution with no luck, she decided to create the solution herself. A product that clipped the pacifier to a baby’s shirt quickly became a brand, which included baby towels, teething mittens, and other baby products (typically in the $6-$20 range). By 2020, the catalog had 31 SKUs that were sold in 3 countries: the US, UK, and Canada.
After 3 years of operating the business, the owner decided that she wanted to pursue a new idea for an Amazon brand. In order to do that, she looked to sell her business quickly and efficiently while maximizing the sale price. The buyer needed to be well-capitalized and creditworthy, ensuring that seller notes would be paid. And after all of the time and energy that she invested in the business, she wanted to see it continue to grow, so she sought an experienced Amazon seller who could scale the business.
Deal Process & Migration
To facilitate the company sale, the owner approached a broker called Empire Flippers. EF introduced the owner to D1 Brands, and an LOI was signed within a week of initial conversations. D1 offered and paid the full listing price. Market standard legal documents were used to keep the process simple. From there, the diligence process was wrapped up in a week.
It took 2 days for D1 to take over the US Seller Central account and the UK listings were transferred shortly after. The owner spent a few hours in the first week after close to assist with the transition, getting D1 Brand Managers up to speed on the business. Since then, she has been hands-off and is receiving her seller note payments, as promised. Her focus has been on pursuing her next business idea which we’re excited to see!
In the first 6 months of taking over the business, we’ve seen very encouraging growth. Run rate daily revenue and profit has increased by +80%. We believe that there is still a lot more we can do. The key drivers of our success thus far have been:
Deals - We’ve leveraged Amazon’s key promotional offerings to drive more volume. For certain ASINs, BSR reached an all-time best and a couple of ASINs acquired the Best Seller badge in their sub category.
PPC Optimization - The team right-sized our bids based on historical conversion rate for top keywords. Rather than using standard software, a D1 PPC specialist conducted this analysis separately which unlocked important insights. While holding ACOS constant, this increased ad sales by 5x. The growing ad sales drove an improvement in organic rank and stronger organic sales.
Geo & Product Expansion - Several products had been sold in a single market. D1 was able to drive higher volume for each ASIN by expanding to new Amazon markets. Additionally, we identified significant variation and new SKU opportunities immediately and nearly doubled the SKU count within a few months of buying the business.
Ready to talk? Reach out!
Whether you’re looking to exit your Amazon business or you’re simply interested in learning more about the acquisition process, we’d love to hear from you! We’re an extremely passionate team of sellers who want to help!
Contact Info: To Sell: Acquisitions@d1brands.io
To Apply: Careers@d1brands.io