- Shopify has a marketplace where merchants can sell their businesses to interested buyers.
- Merchants selling their businesses there say it's a perk that Shopify provides business owners.
- They say that the marketplace doesn't always paint a full picture of revenue, though.
Lynn Woods has sold imported Turkish beach towels on her Shopify store, My Luxe Hammam Towels, since 2018.
Running the store has been a decent side hustle for her, but now she's ready to sell the business and try something new.
"I thought it was a really good time for someone to pick it up because it's established," she told Insider. "I've got the supply chain all sorted out. I've got a good customer base and a good product range."
Woods says her brand could really take off if bought by a person with the right social-media know-how.
"I've not invested a huge amount of money in the marketing and social media behind it," she said.
My Luxe Hammam Towels is up for sale on Shopify's Exchange marketplace, where a page lists her desired asking price as $12,000.
Exchange allows merchants to connect with interested buyers who can see Shopify-verified data about the sellers' average monthly revenue and sessions. On the listing page, sellers can give advice about what would be needed to make the business thrive as well as how much support they'd be willing to give after the transaction is complete. Shopify encourages buyers and sellers to hold all negotiations within the Exchange messaging platform and then complete transactions with its payment partner, Escrow.com.
Thousands of Shopify stores are listed for sale on Exchange, ranging from small drop-shipping businesses asking for less than $1,000 to subscription-box companies looking for at least $1 million.
Exchange has been around since 2017, but merchants cashing in on strong online sales during the COVID-19 pandemic is a growing trend, particularly on Shopify and Amazon.
The venture capitalists Keith Rabois and Jack Abraham recently teamed up to launch OpenStore, which makes automated offers to online businesses with a focus on Shopify stores. Rabois told Bloomberg in June that the startup hopes to acquire dozens of Shopify merchants over the next year.
By building its own marketplace that automatically populates sales data from the back end of its merchants' stores, Shopify is providing another service aimed at making it easier to run an online retail business from start to finish.
A Shopify representative did not return Insider's request for comment on this story.
'A great value-add that Shopify provides for you'
Six potential buyers have contacted Woods since she put her business up for sale in March.
She said she's grateful to avoid having to sell through a business broker, as commissions can end up making that process expensive. Business appraisals are also quite expensive for small-business owners, often costing thousands of dollars.
Like Woods, Stephen Spivak worried about selling his drop-shipping business through a broker. He has been hoping to sell his business, The Wearables Store, on Exchange for several months. He said his ideal buyer would be a business that already has drop-shipping and warehouse infrastructure in place.
"They could just take their operations that they already have now, and just scale that with mine," he said.
His business is listed for $75,000 on Exchange.
Room for improvement
Merchants did say there are a couple of downsides to using Exchange.
Shopify doesn't appear to do much promoting of the service, they said. Discrepancies between the annual revenue provided on the marketplace and what a business truly earns are also common.
Exchange pulls in sales figures directly from merchants' Shopify pages, so sales on Amazon, Google Shopping, or even in brick-and-mortar stores aren't taken into account.
"It would be ideal if Exchange would allow a field or two to say, report any other revenue that isn't reported in Shopify," said Josh Pinto, who is selling his store, plusmotif.com, for $39,000 on Exchange. "Exchange does give you a quote, but that really isn't relevant when you know your own business."
Pinto added that revenue, which is displayed on the Exchange listing as averaged over the lifetime of the store, can be misleading. His store didn't have many sales early on, but it really took off in the past year and a half. He said Exchange makes the average monthly revenue appear too low.
The merchants who spoke with Insider ultimately said they believe Exchange is another perk that shows Shopify's commitment to making things easier for small- and medium-sized businesses. Amazon, for example, doesn't have a place where marketplace brands can advertise themselves to bigger companies that might want to buy them.
"I think it's a great value-add that Shopify provides for you," Spivak said. "If you didn't have that, then I think you're stuck with a network of brokers that you can work with, and I think it's much more difficult to do it that way than it is within one space of Shopify."
