Branded dropshipping Shopify store with >50k revenue and 15,000+ untapped emails
Shapewearsco.com is a >$50k lifetime revenue branded Shopify dropshipping store selling women’s shapewear. 15,000+ emails | Lifetime Profit: $1.38k (see explanation) | 5 months old | Great suppliers.
1. Seller Bio
I am a full-time Corporate Strategy professional who deep dived into the world of eCommerce near the beginning of the lockdown due to Covid-19. I have studied and experimented with digital marketing, growth hacking, copywriting in the past, but took my first serious attempt at drop shipping this year. I have been running this store as a side hustle and have started other drop shipping stores since. I have bitten more than I can chew with my multiple websites and full-time job. I am now gradually selling off all but one of my websites so I can focus on growing one without burning myself out. I currently operate all my businesses by myself, including sourcing, advertising, fulfilment, and customer support.
2. Executive Summary
Flippa Valuation: $13,253 – $16,199 USD based on October Month to Date results i.e. October 1-17 (see attachment for screenshot of valuation)
The estimated value of the website is $13,745 USD based on calculations (see Seller’s Note for detailed breakdown). However, I am open to negotiation for a quick sale for the right buyer.
· Total customer emails in Shopify database: 15,760
· Active customer emails in Klaviyo: 15,004 (excludes 757 supressed profiles)
· 13,557 customers accept marketing
· 1,948 text marketing subscribers
· Lifetime revenue: $54,683.73
· Lifetime profit: $1385.34
· Lifetime online sessions: 69,966
· Lifetime returning customer rate: 4.83%
· Lifetime orders: 2,919 (slightly over-recorded due to draft orders for returns/exchanges)
· Primary sales channel: Facebook Ads
· Domain value: USD $1,123 (GoDaddy valuation)
Please note that I had a payment decline rate of about 10-20% until early August because I am in Australia and did not have a US based Stripe account. This means that my sales would have been 10-20% higher from the beginning of the store till early August if I had a US based Stripe account.
I stopped running ads from early September to end of September to focus on my other stores. I began running ads on a small budget again recently to grow the email list for the next buyer. I am only selling this store because I do not have time to work on it further, and do not have any real-life experience with shapewear products for women.
This store dropships women’s shapewear from China and US warehouses with all current advertising to the USA. I started the store in May 2020 as a one product store and turned it into a branded niche store in July with over 90 products. The shapewear industry is a fast growing and lucrative one with high margins, and the products sold on the website have a variety of high-quality designs which are difficult to find elsewhere. I only use Facebook advertising with this business, alongside email marketing flows and holiday email campaigns.
My primary supplier is based in China. I have built a great relationship with my primary supplier due to the large volume supplied and they provide dedicated logistics with no minimum order now. I believe my primary supplier has access to the lowest rates on the market for the main products I sell as five other suppliers I have received quotes from are 30-50% more expensive.
My secondary supplier is also based in China but holds a substantial portion of their stock in US warehouses, so they can ship domestically with USPS.
I only use two suppliers to simplify my supply chain and make it easier to fulfil orders and operate the business with minimal work.
I was very new to Facebook advertising and drop shipping when I started this store, so I have been figuring out how to do things along the way. Over time I have made improvements to sales funnels and advertising strategies as I learned to use more apps/tools and techniques. I still have a lot to learn so this is a great opportunity for someone with more experience.
I also hired a professional web design agency to revamp the branding and website, so it looks very professional. There is still room for improvement in cleaning up some images within the product pages, but the main images are clean. I have not yet run any advertising to the newly branded home page.
I have also had my ad account audited by a professional media buying agency and they believe the store has potential to scale further and recommended expanding into other sales channels like Google Ads. I can pass on the details of the agency as well.
Summary:This turnkey drop shipping store has great potential for scale and profitability for somebody with experience in email marketing, Facebook advertising, and other marketing platforms.
· Large and untapped email and text marketing list: 13,557 email marketing subscribers and 1,948 text marketing subscribers. Apart from an abandon cart recovery email and order confirmation email / double check email, I have only sent email campaigns on 3 separate days: Independence Day, Labor Day, and on August 28 (random date I chose) which I generated over $1.5k revenue from. There are a over 1,000 new subscribers which I have never sent an email too as well. I have virtually no experience with email marketing so somebody who has good email marketing and phone marketing experience could make a lot of profit with an untapped list this big.
· Healthy pixel and ad account with good data: over 3,000 purchases recorded on Facebook ad manager with the majority from the US. I experimented with broad targeting and it had promising results so somebody with more experienced media buying skills could use this to run profitable ads to a large audience by experimenting and making better creatives.
· Strong branding and professional website layout that I paid a professional web design agency to use (which I have not tried running traffic to the home page to). It also comes with another premium theme (District by Style Hatch) and web design layout I made if you would like to use that instead. I spent over 150 hours editing the several thousand photos on the website, writing the product descriptions for each product, and making sure the sizing is aligned to supplier specifications.
· Over 90 high quality products with fast shipping from China or US warehouses.
· Two suppliers for simplified operations which you will get access too. Great relationship with primary supplier who has access to my best-selling products at 30-50% cheaper prices than I have been quoted from 5 professional drop shipping agents (including 1 paid quote from Upwork). My primary supplier has fast shipping from China. He is also happy to process any exchanges for free (he just sends the customer the item in a different size / color) so the refund cost is minimal. My other supplier has a lot of their products in US warehouses and have only shipped out their products to customers using USPS.
· Low charge back rate (<0.5%) and returning customers due to good customer service. Weaknesses: · Lack of creative assets for advertising. I have not tested a lot of creatives since I started this business, out of inexperience and lack of time. I would highly recommend the new owner test new products, offers, and creatives to further scale the business. · The store currently uses ZipifyOCU for upsells, but I have recently heard the app reduces conversion rates because it loads slowly. I used the app because it allowed me to process payments with my US stripe account while allowing me to promote upsells but you might want to look at other apps that are faster to boost conversion rates. There is a further opportunity to increase AOV by integrating ClickFunnels so customers can add all the items they are interested in at once instead of going through an Upsell process and customers dropping off between offers. · Sometimes customers confuse our brand for another brand like Shapermint. I suspect this is an industry wide problem. This can lead to confusing emails with customers, but nothing bad has come out of it. · Mono channel sales. I have only used Facebook for cold customer acquisition because that was what I was learning but I would recommend the new owner to diversify. · Low social media following. I have not invested time into posting on social media so there is limited engagement and following. The new owner could use this as an opportunity to build a more branded feel with social content. There is plenty of content (just photos of the products available would create 90+ posts). · No customer retention strategy in place for past customers due to lack of experience and time. This is a huge opportunity for the new owner as our brand has returning customers already. · Little data on countries other than USA as almost all advertising budget has been focused on the USA. 4. Operations · Advertising (5 min to 60 min daily): maintaining and launching Facebook ads can take between 5 min and 60 min a day depending on what activity you are doing. Monitoring and maintaining ads takes the least amount of time while creating and launching ads will require more time. · Fulfilment (10 min to 30 min daily): because I drive traffic directly to product pages, I often only sell my best-selling items on most days. My primary supplier takes care of all these orders, so I export a CSV sheet, check the orders for any errors or incomplete information, and send him my orders each day or every second day. He then sends back a CSV sheet with tracking numbers which I upload to fulfil orders. I am an advanced Excel user, so it takes me between 10-30 minutes to do this everyday depending on the number of orders. For items that are outside of my best sellers, I order them from AliExpress from my second supplier (using ship from US warehouse option). This does not happen every day but when it does happen it can take longer to fulfil orders. · Customer service (10-30 min daily): I am fast with customer service and do it once a day (used to do it twice a day but it did not make much difference in terms of satisfaction). Amount of time spent depends on the volume of orders in a day. Some days will be quiet and other days will be busy from my experience. It is quite random. 5. Customers This store is built around the passionate niche of shapewear for women. Based on emails with customers and repeat customer activity, a sizable portion seem to already have shapewear products and are looking to expand their collection. They know what the product is and want to buy it, sometimes multiple times. Customer acquisition is from the Facebook ads platform. Almost all my advertising budget has been targeted to women in the USA and I have recently begun leveraging the data I have collected to target both men and women (broad targeting), with most sales coming from women. Customer retention is from the Facebook ads platform as there are repeat customers, and email marketing. Most of the focus for this store has been on customer acquisition so there is an opportunity to develop a customer retention strategy. 6. Financials This store is pretty much breaking even and with a few tweaks could become quite profitable. Lifetime revenue: $54,683.73. Lifetime profit: $1385.34. Month (Revenue | Cost | Profit | Explanation) May R: 2220 | C: 1701 | P: +519 E: Supplier sent out wrong (but very similar) items for orders in May so COGS was refunded for a large portion of the orders with only a handful of customers requesting an exchange for the wrong item; hence higher profit. This was a once-off event. June R: 17,874 | C: 16836 | P: +1038 E: Supplier at the time shipped about 200 orders using a different shipping line that took approximately 7 weeks to reach customers. The business provided refunds to angry customers during this period and the following month and transitioned to its current supplier. Current supplier had slightly higher COGS because the previous supplier was underquoting prices by accident. There was confusion around calculation of shipping price based on weight. July R: 8497 | C: 9455 | P: -957 E: Spill-over of refunds provided to angry customers in June. The business faced a substantial loss due to experimenting with Facebook ads and mismanagement of ad budget by its owner. The business' website was redesigned by the owner (with a paid theme). The business then paid a professional design agency to redesign the website. August R: 17,700 | C: 16676 | P: +1024 E: USA Stripe Account set up to mitigate payment declines and a professional redesign of website was implemented. Also ran an email marketing campaign which generated half the profits. September R: 1,789.24 | C: 2211.53 | P: -422.29 E: Loss due to minimal active running of website and fixed maintenance costs from Shopify apps. Also, spill-over COGS from end of August. October R: 6,602.89 | C: 6419.22 | P: +183.67 E: Prorated fixed costs from app (Klaviyo subscription is bulk of cost) as at October 17. Month in progress. Experimenting with lower price. 7. Seller Notes The main value of the store is the email list, website design, selection of products, great suppliers, and data which makes advertising a lot easier. The new owner has a lot of assets to make money with the store right away with little effort. The highest immediate ROI would be sending out emails and texts to untapped customers. I am selling this store because I am burning out running multiple stores and want to simplify my portfolio. What you get: · Domain · Facebook Ad Account · Shopify Account (includes paid theme and professionally designed theme) including all data associated with Shopify Account and its associated apps such as Klaviyo · G-Suite Email Address (includes google analytics account) · Zendesk Account · Supplier details · Media buying agency details (if you would prefer to outsource this work) · All creative assets · Support and management of all customer orders prior to ownership transfer The estimated value of the website is $13,745 USD based on the below calculation; however, I am open to negotiation for a quick sale for the right buyer. Value breakdown: (1) $1,153 (domain name) + (2) $2,770 (annualised profit at 1x multiplier) + (3) $5,262 (niche email list) + (4) $800 (professional website design and premium Shopify theme) + (5) $3,750 (building turnkey website) Source / calculation: (1) Domain name value appraisal from GoDaddy (see attached) (2) Profit: $1,385 after almost 6 months x 2 = $2,770 (3) 13,577 x 2.01% x 15.11% x 19.15 x 59% x 12 = $5,262 # Email Subscribers = 13,557, Click Through Rate = 2.01%*, Conversion Rate = 15.11%**, AOV = $19.15***, Gross Margin = 56%^, Frequency = 12^^ *Based on industry Click Through Rate from Mailchimp. **Based on average email conversion rate in 2020 from Barilliance. ***Based on lifetime AOV of store (see Shopify dashboard attachment to see video with AOV) ^ Gross Margin = 1 – (COGS/AOV) where COGS = $8.50 and AOV = $19.15 ^^Based on one email per month. (4) Cost for professional website design = $620 + Cost for premium Shopify theme (District) = $180 (5) 150 hours x $25/hour wage = $3,750 (time consuming activities: photo-editing (95 hours), product descriptions (50 hours), product pricing (5 hours)). $25 per hour wage based on graphic designer and copywriter average salaries in the United States.