A little bit of news from me after being quiet on here for a while, and for once I am not writing about digital marketing. On August 12th 2021 I completed the purchase of my first ever business! Not something I ever thought I would be writing about, or even doing for that matter. But it is real, I did it, and now I have the daunting task of making it work.
Firstly, I should point out, this business won’t be my day job for a long time, if ever. I will continue consulting on a full time basis. But it is a bonafide business and a genuine acquisition. A good sum of money changed hands and we have to put in place proper business plans for growth. Exciting and scary in equal part.
How did I come to buying a business?
Buying a business wasn’t on the cards, it wasn’t part of my immediate plans, nor was it really in my long term thinking. But sometimes these things just come about.
It started over the Christmas period. I was working but things were quiet. So rather than open another box of mice pies I was daydreaming and thinking about work, income, plans etc. I started looking for websites for sale. This is something I have done in the past. Bought a relatively cheap website with potential, grown its traffic to generate affiliate income or just for fun. I have never been heavy into affiliate marketing but have dabbled, made a few hundred pounds here and there, and on the odd occasion sold a site or a domain on. I came across a few apparel websites in different niches, I was genuinely looking at a Fortnite apparel website with interest for a little while. In some cases these websites would require holding a small amount of stock and managing fulfilment.
One thing led to another with the thinking. Firstly it evolved to looking into other ecommerce sites. The bulk of my work in recent times has been on ecommerce businesses, helping them grow sales online through multiple channels. Having my own ecommerce site would surely help me hone my craft whilst also applying my skills to something I reaped the rewards for. Then we were back to the stock conundrum, “Well if I am going to be holding stock, it is more like a genuine business than a website purchase, so maybe I should look for others….”
The chain of thought led me to be browsing the internet for ecommerce businesses for sale, with a number of criteria. The site and domain had to have potential. I knew I didn’t have the appetite or time to start something from nothing, so there needed to be something there to build on. The products needed to be something with consistent demand, and ideally in an area I could see growing in the future.
That is when I came across a wine business for sale…
Do you believe in fate?
I am not a believer in fate. But sometimes strange coincidences lead us to where we are, and this was definitely the case here.
The problem with the wine business was two fold:
- The business had too much stock. The price of the stock was more than the price of the business list price. To make it viable in the short term a large chunk of that stock needed to be turned into cash quickly, and this wasn’t going to happen through the site alone. It also needed to be stored somewhere.
- To make it viable it needed both trade and direct customers. Higher gross margins on direct, more volume on trade.
In short it was too much to take on with no clear sign to return for me on the face of it. Which was a massive shame as the website is what I was looking for. Aged domain, good base rankings, underdeveloped for what it could possibly be.
I was also of a strong opinion it was an area of ecommerce which had been accelerate by the pandemic. A product that most people bought offline, but were forced to do so online in the first lockdown. I was (and still am) sure that a portion of these new customers to the market would remain and the habit of buying online would continue as long as the experience was good.
Then one day over Christmas I was out walking my dog and my phone rang. It was a good friend of mine from school/rugby days. I hadn’t spoken to him in 6 months at least, and prior to that I can’t recall the last time he rang me. We chatted for a while, caught up on family etc and then I brought up the wine business. The thing is, this friend owns 5 pubs/bars in my old home town, and is well known and respected in the trade around that area and beyond. As it turns out he had been looking at getting into wholesale before the Coronavirus hit his industry hard.
A few days and phone calls later and we were in serious discussions. We needed more information but it felt like we potentially make this work between us. With me driving the online side, and him the trade as well as providing some staff for fulfilment. What’s more, his other business partner owned a storage facility we could use. It was starting to get real.
8 months in the making
What should have been the most simplest acquisition in history – essentially a website and some stock – ended up taking 8 months to complete. Along the way there were a few intentional delays while people needed to wait for other events to unfold, and some frustrating ones (Solicitors, sigh…) But last week we finally completed the formalities and took delivery of the stock. A surreal moment unloading it from the truck into storage, and then panicking when the first order cam through the website and we didn’t yet have a courier arranged. We really weren’t expecting any in the first week at all.
It was a strange feeling knowing we were finally the owners of the business we had talked about hypothetically for so long, but we are now a few orders down the line and learning every step of the way.
Where can it go?
One of the most exciting parts is I really don’t know where this will head in the future. I have a strong belief it has big potential, otherwise I wouldn’t have bought it. But precisely how far it can go is a bit of an unknown for everybody involved. We haven’t set lofty ambitions, We haven’t overpromised anything to anybody, we are just happy to be having a go. If it never becomes anything more than a business we keep running and enjoy on the side, nobody will be disappointed. If it becomes something bigger which we can take on an accelerate further, that will obviously be great for everyone involved. For now we will just enjoy the journey and see where it takes us.
And regarding the not liking wine part. None of the 3 business partners are huge wine fans. I don’t mind a glass or two with a good meal, but would rarely choose it over a cold lager. We are all of the opinion however this could work in our favour. A lot of business owners are supremely passionate about their area, to the point of becoming snobbish about quality. This can blind them from the realities of what the customer really wants. Our approach will be demand driven, if it sells we will stock it. And if we need wine expertise to support us, we can buy that skillset in. What is less easier for others to replicate is our 40+ years combined of ecommerce capabilities and industry knowledge. At least that is what we hope…
If you want to check out our wines you can see them at our website https://www.affordablewine.co.uk and if you do place an order, give us a bit of slack, we are new to this!