How To Flip Shopify Stores (from 1K to 1M?)

Hey 👋

If you’re reading this — odds are that you are a merchant or at least dabbled in eCom.

You’ve probably tried growing an online store (or already have a successful one), but did you know there’s big money in flipping Shopify stores?

In today’s post, we’ll show you a case study of what’s possible when selling a Shopify store, where you can find stores to flip, and how to buy & sell them 🤑 

Let’s get into it 🔥

1. A Unicorn “Spiritual Jewelry” Case Study?! 🤔 

An awesome example of a successful Shopify store exit comes from Empire Flippers — with a spiritual jewelry store being sold for $12.4M. The store itself had a 70% YoY growth with a revenue of $274K/mo 🤯 

Before getting into what made this store successful, let’s look at the key metrics that usually impact store valuations & sales:

• Revenue Multiples — Shopify stores are usually valued at 2.5x-4x their annual revenue.

• Supplier Requirements — stores with diversified supply chains (in multiple regions) are more sought after since they are more resilient.

• Product Variety — a store with multiple winning products is valued higher than one with a single hot product.

• Marketing Diversification — successful stores often have a mix of both organic & paid channels, strong engagement on many social media platforms, and good engagement on email lists.

As for this case study, here are the details of the exit & what we can learn from it to flip stores:

1️⃣ Growing Business

The store was in its growing stage, meaning it was profitable but not slowing down. This is the best time to sell your store, the “ramping up” stage in the S-curve is what we’re referring to here:

2️⃣ Diversified Supply Chain

This is a telltale sign that a store is promising (especially for private equity investors) — the spiritual jewelry store didn’t just have 3 factories in China, but multiple in India, the U.S., and Mexico too, making it less fragile to black swan events like the one we had back in 2020 🙊

3️⃣ Strong Assets

The owner had an email list of 230k subscribers & over 500k followers on social media. With this reach & potential for engagement, who wouldn’t want to acquire a store like this?

This is a unicorn of a case study, but you don’t need a massive store to make a profitable exit — you can just buy smaller stores & flip them for more while looking out for some of the success factors we listed above 😄 

Stay tuned for more exciting updates from Ecommerce & Unicorns! Subscribe now:

2. Where To Find Stores To Flip 🛒 

Out of the hundreds of store marketplaces, a couple stand out:

1️⃣ Flippa

A well-known marketplace for buying & selling Shopify Stores (and not only). They’ve got over 2M registered users and offer escrow services for safe transactions & there are over 60K active listings as of now.

2️⃣ Empire Flippers

Empire Flipper’s marketplace offers a free website valuation tool, provides post-sale support & and has a strict vetting process so that only high-quality stores are listed. And while they’ve got a smaller buyer base than Flippa & Acquire, their focus on quality over quantity can be more appealing.

3️⃣ Acquire

Acquire is a marketplace for SaaS businesses, including Shopify stores. We’ll be covering this marketplace in more detail soon (how to buy & sell on it), but for now, we’ll highlight the metrics this marketplace can display for a store using this visual:

You can see a listed store’s yearly & monthly revenue, last month’s profit, and its top marketing channels (paid & organic) — they are filtered by users, sessions, and Acquire even lets you see the bounce rate. Name a marketplace that shows all these metrics, I’ll wait 😂 

Let’s finally figure out how to buy & sell stores plus the key metrics you must look out for 🔥

3. How To Buy a Shopify Store 💰️ 

For simplicity, we’ll cover how to buy & sell on Acquire, but the process is similar on other marketplaces.

1️⃣ Define Criteria

Filter the type of Shopify stores you are looking for based on price, revenue, monthly multipliers, and niche.

❗️ Keep in mind, the average revenue multiple Shopify stores are sold at is between 2.5x-4x, depending on niche & scale. This is where you need to decide whether you’ll buy a store at a low multiple to flip for higher, or take over an already successful one at a higher multiple.

On Acquire, if the store’s metrics are connected, analyze the web traffic (bounce rate, sessions, users, etc). If metrics aren’t connected, use tools like Similarweb & Google Trends — a successful store would have an inclined user graph like this, for example:

Look at the acquisition section as well, and pay attention to the top channels that are used to promote the store — along with this, check their social media to see whether their shoppers have high engagement.

2️⃣ Shortlist & Offer

Browse the listings, create a shortlist, and submit an LOI (Letter of Intent) for the store you are interested in, then play the waiting game until you get a response from the seller.

3️⃣ Negotiate & Close

Negotiate terms with the seller & ask for financial documents like profit/loss and cash flow statements, sales records, inventory reports & intellectual property documents.

❗️ Before buying a store — request up-to-date data from the seller & analyze metrics like CAC, LTV, engagement on email lists, and other metrics that aren’t innately shown on Acquire.

If the store has a good track record and everything has good looks, finalize the deal with an Asset Purchase Agreement (APA) and use an escrow service to secure the transaction (Acquire does that for you).

Voila — you’ve bought a Shopify store that you can now either grow yourself or flip for a higher multiple 🔥

Also, refer back to our unicorn case study, those points are great to look out for!

4. How To Sell a Shopify Store 💵 

We can learn how to sell a store from Derek’s story.

He prepared for his sale by organizing the company’s financials and data, including revenue statements, order information, customer data, and email lists — absolutely everything that can be viewed as an asset & would be part of the sale.

Through a friend, his store was listed on Acquire, Derek then evaluated potential buyers & closed the deal in March 2023 with someone who fit his criteria. All that was left was to cleanly transfer ownership & fulfill any remaining orders.

A short, but sweet story — from it, we understand that as long as you prepare your store for the sale properly & find a buyer that fits your criteria, not much can actually go wrong. Now, let’s turn this story into a template for you to sell your own store 🔥

Before starting the selling process, determine whether you want to sell your store yourself, or get guided help from Acquire’s GAP (just like Derek got help from his friend, but even better) — a VA will assist you in completing each step of your sale.

1️⃣ Ensure Clean Financials & Track Metrics

Ensure you have all necessary documents ready, including profit and loss statements, cash flow statements, and sales reports.

Make sure you’re tracking key metrics like CAC, LTV, and MRR consistently — this only helps potential buyers better understand your store’s profitability & potential for growth.

2️⃣ Prepare The Store for Due Diligence

Make sure you have access to Shopify & Google Analytics, all store-related social media accounts (to make the transfer of ownership as smooth as possible), and any other tools that showcase your store’s performance.

All metrics should be transparent & well-documented, and ideally, you’d connect the metrics directly to your listing on Acquire.

3️⃣ List Your Store, Evaluate Buyers & Review LOIs

After listing your Shopify store, engage with interested buyers to assess their fit. Look for verified identities and funds, and require buyers to sign a mutual Non-Disclosure Agreement (NDA).

Review letters of intent (LOIs) & negotiate the terms to meet your expectations before accepting an LOI

❗️ Accepting an LOI will start an exclusivity period during which you can’t negotiate with other buyers.

4️⃣ Escrow & Transfer

Once both parties sign the APA (asset purchase agreement), enter escrow with the buyer. Once the escrow process is completed, your Shopify store sale will be finalized 😄 

That’s it! We covered a unicorn case of a successful store sale, the most popular marketplaces, and how to sell & buy Shopify stores!

Is Ecommerce & Unicorns helpful? Share it with friends and don’t forget to subscribe!

Need help with your ecommerce project? Wanna learn more about Shopify in our weekly blog? Just hanging around?

Thanks for reading and supporting E&U (Ecommerce & Unicorns)

Daniil from ECORN