Featured Listing: Centauri Gear

About the business

Tell us a little about yourself. What’s your background? How did you start the business?

Centauri Gear was launched in January 2018 by Nanda Krishnan as a completely remotely-operated eCommerce business on the Shopify Platform using the dropshipping business model.

I started this business as a side hustle when working a full-time job as an electrical engineer but it eventually evolved into a full-time gig and it has generated close to $700,000 in revenue since launch as of today.

With regard to my background, I did my bachelors in Electrical Engineering and then, later on, went on to get a Masters in Business Administration.

When I started with eCommerce, I had no knowledge of the industry, the operations or any digital marketing experience. Everything was learned on the way – its operations and digital marketing on Facebook. However, I did learn a lot of things on the way to grow this business and I’m still in the process of gaining more digital marketing experience.

As an eCommerce business, where are your products made?

All the products are manufactured in China to keep the costs low and the margins high. Most of the products are sold at 3x or 4x the manufacturing cost with extremely healthy margins.

What can you tell us about your Customer Lifetime Value (CLV) and Customer Acquisition Cost (CAC)

Customer Lifetime Value: This can be significantly increased with Email Marketing, introducing a loyalty program that hasn’t been implemented, connecting with your customers with a blog, etc.

Customer Acquisition Cost (CAC):

Since the primary marketing medium has been Facebook Ads, customer acquisition cost directly depends on how expensive Facebook ads are. If I were to make a rough approximate, it would be 30-40% of the product cost. So for a $100 product, $30 would be the product cost and $30-40 would be the acquisition cost. But through upsells and cross-sells, increasing the Average Order Value, you can decrease the aggregate CAC per purchase.

How have you marketed the product and where are your customers originating from?

Yes, I have marketed the products – only through Facebook ads. Facebook ads have been my primary marketing medium channel since the beginning. I have not diversified my marketing channels beyond Facebook but that would be one suggestion for the new owner so that the customer acquisition cost can be reduced.

The majority of the customer base is located in the United States, United Kingdom, Canada, Germany and Australia. But also depending on a specific product – Singapore has been significant for some products, Italy has been significant for some products.

Is the asset on your listing owner-operated, how much time does it take to run the business, who else is needed on the team, and what is automated?

It takes about 2 hours a day to operate. About 15 hours per week.

To this date, everything was done on my own. These are the main aspects to running this business: Order Fulfillment, Customer Service, Marketing.

Order Fulfillment is fully automated.

I have been doing Customer Service on my own but this is the easiest thing to outsource and automate.

Marketing is the last thing you want to outsource and will take up the majority of your time to run the business.

What does someone need to do to continue operating the business in its current form?

The business would suit an enthusiastic and savvy digital marketer with a passion for eCommerce and Sporting Goods. It would also be perfect for an existing eCommerce entrepreneur who would like to add Centauri Gear into their portfolio.

Digital marketing experience or a passion to do it is a huge asset – that is what’s really going to drive this business to huge growth. The new owner would also want to diversify the marketing channels beyond Facebook to other digital marketing mediums such as Google Ads, Snapchat, Pinterest, Tik Tok, SEO, PPC, Influencer Marketing, etc to achieve maximum growth.

Growing the business

Can you list a few opportunities for a potential new owner to continue growing the business?

I will also provide valuable information on how to improve the existing business model, business practices, efficiency, changes to be made to the current website/marketing channels and so much more.

Side-Note: Moreover, I have valuable customer feedback/recommendations from hundreds of past customers who would love to improve a particular product by adding new features and modifying existing specifications. This would be a great fit for someone who is interested in developing their own product with the help of a design agency and getting it patented; there’s already a proven market demand and my current supplier can assist with the manufacturing.

New opportunities to improve according to real feedback from customers and others:

  • Redo the website design (easy fix)
  • Optimize the landing pages (easy fix)
  • Increasing the site load speed (easy fix)
  • Implement SEO (long term strategy)
  • Google Ads (long term strategy)
  • Pinterest, Snapchat, Tik-Tok, etc. (long term strategy)
  • Private labeling of products (short term strategy)
  • Develop new products according to past customer feedback (long term strategy)

What has been the evolution of this asset since its launch?

Since its launch, it has done close to $700,000 in revenue.

Again, most of the revenue was directly impacted by Facebook Ads marketing but if you were to branch out the marketing mediums, you can grow it even more.

How does this business make money? What are the current revenue streams?

Primary revenue from direct website eCommerce sales (Shopify Platform)
Primary Traffic from Social Media (Facebook/Instagram)
Secondary Traffic from Organic Searches on Google, Email Marketing, Blog Mentions
Mobile Optimized Website
Email Marketing Integrated on Klaviyo with 16,000+ subscribers

What marketing channels are most profitable for the business?

The most profitable marketing channel is Email Marketing for the highest ROI. But the channel that pushes the most revenue is Facebook Ads.

How does the business currently acquire customers and what is your breakdown for marketing costs?

The business has always acquired customers through Facebook Ads. And Facebook Ads contributes to 30-40% of the total costs.

How big is your current team? How many people does it take to run this business?

I am the only one in my team. It can be run by a single person. However, outsourcing customer service can significantly reduce the time to run this business and is the easiest thing to outsource.

What’s the reason for selling your business on Flippa?

I would love to continue on with this online store since it requires very little effort to operate and I have access to an outstanding supplier for sourcing products. However, I am trying to move on from physical products to digital products and currently working on starting my own marketing agency with all the experience I gained from Centauri Gear so I’d like to allocate all my time towards that.

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