Case Study: EZTool

Case Study: EZTool

Platform: Amazon FBA
Business Model: eCommerce
Business Age: 3 Years
Sell Price: $160,000

EZTool sells watch repair kits via Amazon FBA. They’ve tapped into a niche and the growing direct-to-consumer FBA space. The search power and logistics capability of Amazon has helped them to find a sweet spot. The product is simple and suits the home watch enthusiast! This month EZ Tool Founder Angus Hess successfully found a buyer and has recently completed the sale on Flippa.


What is the product?

EZTool sells two different watch repair kits. Kit one is more conclusive with a wrench and illustrated manual and kit two – the QuickFixxer – is a 16 piece tool kit.


What makes EZTool such a good business?

There’s really two things. Firstly, it’s found a path to popularity in a niche. The product is well supported by a 41 page illustrated guidebook and comes with a 100-day replacement guarantee (nothing like a guarantee to woo customers). Secondly, they’ve successfully leverage Amazon FBA and benefit from cost-effective shipping, storage and world class customer service.


Who is the EZTool customer?

There best selling kit is perfect for watch enthusiasts and connoisseurs alike. Aimed at those who enjoy DIY as well as those looking to save money on pricey jewellers fees the EZTool products sell steadily all year round. And, they’ve found their kits have become very popular gifts.


Why was it so appealing?

Easy to understand this product had significant interest among the Flippa buyer community. Couple that widespread appeal with the FBA model, the strong consumer feedback scores and strong financial results – EZTool was generating between $5-14k profit monthly, which is in part due to low time commitment – and you have a winner.


How did Flippa assist?

The Flippa model has evolved and it’s beginning to suit higher value buyers. That alone is a big win. Flippa now has over 150,000 registered buyers representing a combined purse of over $9bn wanting to be placed. There are not enough sellers. Once they pop up, sellers like EZTool are benefited from the self-service platform, lower success fees than other channels and dedicated account management.

Is it time your business jumped onto Amazon FBA?

Is it time your business jumped onto Amazon FBA?

If you already have, or you’re contemplating, a start-up with an actual physical product to sell, then you have probably heard of Amazon FBA – but what is it exactly and what are its advantages and any potential drawbacks you need to know about?

Well, as a budding mature-age entrepreneur myself I’ve been very interested to follow the progress of one of my friends, Georgina, who has been steadily building a very successful business in high quality skin care products, emulating the well-known and pricey Aesop’s range, but with some extremely creative additions as well.

Like so many other successful start-up businesses, Georgina’s was initiated in her garage, where she worked hard to experiment with bases and herbal ingredients (some of them very expensive) and the mixing, matching and blending processes to create not just practical but alluring fragranced skin products – from hand-wash, to body wash, to nourishing body oils, and later on perfumed candles and aroma diffusers.

The design of packaging (again very expensive) was a major challenge. Logos and branding took time and creativity. The initial sales (obviously on a loss basis for quite a while given the development costs) were to family and a network of friends. But there was a vision. The vision held firm and the viability grew. Finally there was proof of concept as the sales took hold online and some great exposure was achieved when a major Melbourne homewares brand with several suburban stores agreed to stock some of the range.

By now the garage was completely outgrown. It was time to lease a bigger space just for the production itself, and the rental was a significant expense. Georgina took on a couple of university student casuals to help her – but by now the real problem was storage, managing inventory and delivery. Packaging and posting individual orders and hand delivering the store orders had become unmanageable and Georgina was completely out of storage and handling room.

Amazon FBA (Fulfilled by Amazon) entered the Australian market space just 12 months ago – at exactly the right time for Georgina. As a great example if IaaS (Infrastructure as a Service), Amazon FBA manages every aspect of the pick-up, storage, inventory management, order shipping and even customer returns.

It’s useful to clarify that your product does not need to be sold on Amazon itself (although of course it can be). The winning point of differentiation for Amazon FBA is that it’s an end-of-the-line system which saves your business time and money because Amazon stores your products and manages their delivery in your direction. The fulfilment fees are extremely competitive, given Amazon’s vast network of storage, delivery and inventory management systems. Their advanced data management systems allow you to monitor and track all inventory, orders and deliveries as they are happening.

The fulfilment fees include all packing of orders, inner packaging and delivery, even including the management and accounting for any returns. Separately there is a monthly storage fee, based essentially on your cubic metres of stored product. It would be impossible for a small start-up company to access its own rented storage facility in an equally cost-effective way.

All of Georgina’s products are classified by Amazon FBA as ‘standard-size’, but companies with large physical products such as craftsman-made tables and furniture are also accommodated on a different storage fee schedule. One potential financial hiccup to be aware of, is that Amazon FBA storage fees have a price hike (literally tripled) in October-December because of the premium on space in the lead-up to Christmas, but this applies to the storage fee only, not to processing and delivery fees.

Obviously, costs will depend on the kinds of products being handled, but as an indication in Georgina’s case, her typical $30-$40 product has a per-item cost of under $3 for picking up, packing and shipping, plus around $30 each month per cubic metre of stored products. In the case of her business, that’s a lot of product she doesn’t need to store, package and handle for shipping, allowing her and her couple of part-time assistants to concentrate on what they find more interesting and enjoyable – developing and actually making their product range.

For a small business, there are really very few drawbacks in using Amazon FBA. Initial account set-up, including business and individual identity verification, and learning the system for preparing product for FBA collection is a bit complex initially, but once managed it’s plain sailing. It’s also sensible to check out the very large number of order fulfilment alternatives to FBA offered by many companies now for Australian-based businesses. Few can rival the economies of scale of Amazon, but the best deal for your business may depend on exactly what it is you’re selling and your own production or sourcing processes.

In this article, I’ve concentrated on Amazon FBA for Australian-based businesses creating physical products for sale. However, it’s important to remember that there is a massive growing global enterprise in third-party selling. This is where the trader sources products from an original supplier literally anywhere in the world, and then markets it with a price markup, often at a huge margin. Using Amazon FBA the third-party seller can create a highly profitable business without ever actually handling the physical merchandise at any point at all.

A variation on this, and one that is often highly successful is the ‘Private Label’ approach. This is where an already existing product is sourced, usually from a low-cost producer overseas, and branded with the third-party seller’s own logo and brand name.

Now that’s a completely different scenario from Georgina’s business, but a very interesting one to explore in a separate discussion another time along our journey.

 

Amazon FBA Traffic Guide for the Holidays

Amazon FBA Traffic Guide for the Holidays

Data by Jim Cockrum & Brett Bartlett, Owners of ProvenAmazonCourse.com

Wondering when you can expect the most traffic to your Amazon store over the holidays? Our Amazon FBA training partners, Brett Bartlett and Jim Cockrum of ProvenAmazonCourse.com have sold hundreds of millions of dollars online, and they agreed to share their shopper behavior timeline with us for the remainder of 2017.

Amazon Traffic Intensity Guide

NOVEMBER INTENSITY OF TRAFFIC 1-10 TYPE OF SHOPPER
23 6 Wants a deal
BLACK FRIDAY 10 Wants a deal
25 5 Wants a deal
26 6 Wants a deal
CYBER MONDAY 10 Wants a deal
28 4 Wants a deal
29 5 Wants a deal
30 6 Wants a deal
DECEMBER INTENSITY OF TRAFFIC 1-10 TYPE OF SHOPPER
1 7 Willing to pay regular price
2 10 Willing to pay regular price
3 5 Willing to pay regular price
4 6 Willing to pay ABOVE regular price
5 10 Willing to pay ABOVE regular price
6 4 Willing to pay ABOVE regular price
7 5 Willing to pay ABOVE regular price
8 9 Will to pay premium / Needs 2 day shipping
9 9 Will to pay premium / Needs 2 day shipping
10 9 Will to pay premium / Needs 2 day shipping
11 9 Will to pay premium / Needs 2 day shipping
12 9 Will to pay premium / Needs 2 day shipping
13 9 Will to pay premium / Needs 2 day shipping
14 9 Will to pay premium / Needs 2 day shipping
15 9 Will to pay premium / Needs 2 day shipping
16 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
17 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
18 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
19 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
20 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
21 10 Cyber Monday / Black Friday Traffic / Willing to pay for expedited shipping
22 5 Slow down and only expedited orders are placed
23 5 Slow down and only expedited orders are placed
24 2 People begin celebrating Christmas
25 2 People begin celebrating Christmas
26 6 People start ordering with Amazon gift cards
27 6 People start ordering with Amazon gift cards
28 6 People start ordering with Amazon gift cards
29 6 People start ordering with Amazon gift cards
30 4 New Year slow down

Flippa Partners with Industry Leader for Amazon FBA Training

Flippa Partners with Industry Leader for Amazon FBA Training

Photo credit: https://www.businessinsider.com.au/its-still-day-one-first-photos-of-amazon-australias-melbourne-fulfilment-centre-2017-1

 

Guest blog by Jim Cockrum, founder of the Amazon FBA training course – Proven Amazon Course

 

Let’s start with an obvious observation.

 

Amazon FBA is hot!

Currently, Amazon FBA is one of the most wide open and most talked about business opportunities in the e-commerce universe! As a business model FBA benefits include:
    • Ease of launching from scratch
    • A short learning curve
    • A truly global opportunity
    • Very low capital risk required to get started
    • Very predictable growth if proper strategy is deployed
    • Favorable market conditions for future growth
    • Automation & hands free operation are possible
    • Creative resources are readily available to assist you
    • From day one you have a built in ravenous customer base

These factors and others make the Amazon FBA opportunity nearly impossible to ignore as a premier online business option.
 

What is FBA?

FBA stands for Fulfillment By Amazon. Most simply stated, you can ship your goods to Amazon warehouses and Amazon will sell and ship the product to the end customer for you.  You never even have to see or touch your inventory if it comes straight form a supplier or manufacturer! It’s one thing to understand what FBA is by reading Amazon’s own description of the program,  but it’s another matter entirely to build a successful, scalable, sellable business on the platform.

 

How much bigger will FBA grow?

FBA is in its infancy.  Amazon is building warehouses globally and is set to open soon in Australia as its latest conquest.

Consider these facts as well: According to U.S. government data, retail shopping online is still less than 10% of all retail spending in the U.S., but that number is projected to grow rapidly in the coming decade and could easily reach 25% in that short time.

In other words, most of the growth in e-commerce and Amazon FBA is yet to come – and it’s coming rapidly! Unless there is a major disruption of current trends, Amazon is clearly set to see incredible annual growth for years to come. That serves to substantially benefit those who are building FBA businesses on the Amazon platform. The opportunity is truly global as well because as an FBA business owner you can use our extensive network of partner services that accommodate every possible challenge in moving your inventory to where it needs to go.

 

Which FBA strategies are hot?

There are numerous ways to succeed with an Amazon selling business.
  • Selling your own private label product
  • Establishing relationships with wholesale sources
  • Sourcing unique products from small businesses that aren’t selling online yet, or are marketing themselves poorly
  • Bundling already popular products to make new listings
  • and many, many more…
Opportunity is abundant because customer spending continues to escalate on Amazon!

 

Why partner with Flippa?

Our FBA training team is delighted to have been contacted by Flippa in order to form a partnership that benefits those who wish to start or grow with the FBA model.  The Filppa leadership indicated to us that numerous Flippa.com users were making inquiries in recent months on the topics of buying, starting or growing an FBA business. As a result, Flippa began to research extensively and eventually came to the conclusion that we were the perfect FBA educational partner for their community. We are of course honored to form this partnership in order to better serve those seeking success with FBA.

 

About our Proven Amazon Course

No one in the world has served Amazon selling professionals (aka FBA sellers) for as long or as successfully as has the creative team behind the Proven Amazon Course.  We have our own publicly disclosed 8-figure online selling accounts that demonstrate our depth of knowledge of the platform. We’ve received over 1,000 documented success stories as well which all credit our coaching and course for having helped establish and grow incredible Amazon FBA businesses.

 

We have successfully assisted thousands of students with:
  • Launching an FBA business from anywhere in the world
  • Building private label brands on Amazon
  • Building a team for scalable growth
  • Finding creative sources of profitable inventory
  • Creatively marketing Amazon products through advanced Facebook strategies

 

We are delighted to partner with Flippa, and we’d love to hear from you if you are interested in learning more about launching or growing an Amazon FBA business.

 

 Proven amazon course_Flippa_Jim Cockrum

 

About the author:  Jim Cockrum is a best selling web marketing author and a seasoned Amazon FBA expert. His courses, books and coaching are the foundation behind thousands of Amazon seller success stories.  His industry leading course located at ProvenAmazonCourse.com contains numerous comprehensive modules for both beginner and advanced online sellers who are either launching or growing an Amazon FBA or Amazon merchant fulfillment business.  The latest update of his book, “Silent Sales Machine – 10th edition” is a consistent top 10 seller on Amazon in numerous e-commerce categories.
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Read more about Amazon FBA:

 

Amazon FBA Buyer & Seller Case Study

Amazon FBA Buyer & Seller Case Study

I’m joined today by both Alan Peterson and Kurt Hansen, the buyer and seller of an Amazon FBA business that was sold on Flippa for $82,500 via Buy-it-Now.

This private label FBA personal care products business has 6 total products with a 4.7-star average review. The business generated $32,000 profit over the trailing twelve months and included the Amazon Seller Central Store, Amazon Vendor Central Store, and $25k of inventory at cost.

(more…)

Seller Central Confirmed: How to Transfer an Amazon FBA Account

Seller Central Confirmed: How to Transfer an Amazon FBA Account

It’s no secret that Amazon doesn’t like talking about transferring Amazon FBA accounts. In fact, their terms of service technically does not allow FBA accounts to be transferred, but this hasn’t stopped people from being able to buy and sell their FBA businesses.

Our goal at Flippa is to remove the barriers between buying and selling of all online businesses, including Amazon FBA businesses.

In one of our more recent sales, we worked alongside Amazon Seller Central representatives and were able to capture the exact steps necessary to transfer an FBA business.

Here are the steps to transfer an Amazon FBA business:

Step 1) Update the Primary Email

The first step is to update the primary email of the account over to the new owner. This can be accomplished by going into your account settings and under the related links section, selecting “Login Settings”. Once you’re on the Login Settings page, you can edit the primary user email ID and password.

It is recommended to discuss with the new owner which email they prefer using, and then setting the password (and making sure to write it down!).

Now that a new email and password has been set, the new owner should be prompted with an email saying the account has been transferred to them. Now provide the login information to them, as they’ll need to finish out the rest before the transfer is complete.

(Note: If you’re also transferring the email account, it is recommended to change the password and then give them the login information.)

Step 2) Have New Owner Complete Tax Interview

Now that the new owner has control of the account, it is up to them to complete the tax interview. This is standard process when updating the business information of an FBA account. The tax interview can be found by going to account settings page and clicking “Legal Entity” within the Business Information section.

Step 3) Update Bank & Credit Card Information

Once the tax interview is completed, the new owner will need to update both the “Deposit Methods” and the “Charge Methods” which can be found on the Account Settings page underneath the Payment Information section.

Once these three items have been completed, the new owner will now have full control of the seller account!

If you’re curious about the original contents of the email from Amazon Seller Central, here it is:

I would like to inform you that the seller of a particular account can provide all the authority over the account to someone else by simply updating the primary email address and re-taking the tax interview and updating the bank and credit card information of the other person to whom you would like to sell.

Kindly know that, to update the primary user email ID, all you have to do is go to account settings> Login settings (under ‘related links’) section. Once the page is opened, you can edit the primary email ID and the password. You can update the primary email ID section with that of the email ID of the person that you wish to sell to.

Secondly, ask the other person to go through the tax interview once again (tax interview is nothing but the initial process that you had to undergo to update the business name.. etc..) in the Legal entity link under the ‘Business information section in the account settings page.

Once the other person completes the tax information, he can go ahead and update the bank details and the credit card details in the ‘Deposit methods’ and the ‘Charge methods’ respectively under ‘Payment information’ section in the account settings page.

Once the other person completes all of this process, the account will be under the other person’s control with the bank, credit and email information all will be under the other person’s name.

It’s important to note that the transfer process may differ depending on the circumstances of each Amazon FBA business. It is always recommended to contact Amazon Seller Central before transferring ownership of an FBA business.


Have you ever transferred or received ownership of an Amazon FBA business? Let us know in the comments what your experience was!