6 KPIs to Track For An Optimal FBA Business Exit

If you’re an Amazon FBA business owner considering an exit at some point in the future, tracking & improving these 6 (technically 8) key performance indicators (KPIs) is crucial for an optimal sale.

1 – Inventory Performance Index (IPI):

Maintaining a high IPI score is not just about keeping Amazon happy; it directly impacts your exit price. Low scores can lead to storage restrictions, reducing your revenue potential, which reduces your net profit potential, which reduces your base valuation potential… It’s a downward spiral.

2 – Order Defect Rate (ODR):

An elevated ODR raises red flags for potential buyers. Outstanding customer service is a must for a successful exit.

3 – Product Reviews and Seller Feedback:

A stellar seller reputation is a selling point, and sometimes absolutely necessary depending on what niche you’re in. Positive reviews and ratings (4.5 stars +) can boost your business’s value.

4 – Return Rate:

Excessive returns affect profitability and account health. They signal customer dissatisfaction, making your business less attractive to buyers, unless they’re looking for a business they can fix and if that’s the case, they certainly won’t be looking to pay you a premium for it…

5 – Account Health:

A healthy Amazon account is vital for selling. Any issues can lead to suspension,and since the main asset that a buyer would be acquiring is the account itself… This may significantly diminish your exit options.

6 – TACos, RoAS, and ACoS:

I’ve lumped all 3 of these together for simplicity. These advertising metrics help you make informed decisions, optimize spending, and maximize ROI. Rising KPIs in this area may indicate challenges ahead, and more competition coming in for similar products, which can ultimately affect your net profit and potential buyer interest.

Success in selling your FBA business starts with data-driven decisions. Keep an eye on these KPIs and aim to improve them to achieve an optimal exit.

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