Case Study - Shelf Company Sales

A client with a unique business model approached us for consultancy. The business was based around shelf companies.

Shelf companies are companies that have been previously incorporated and can be purchased “Off the Shelf”. They are also called ready-made companies and when they have been on the shelf for more than a year they are called “Aged Shelf Companies” or  “Vintage Shelf Companies”. Many types of companies from several jurisdictions can be bought from the shelf and the term “shelf” only refers to the fact that the company has already been registered and is sitting “on a shelf” waiting to be purchased. The older the company the greater the investment by the seller in statutory fees and in keeping the company alive, and hence, only a few sellers can maintain large lists of aged shelf companies. Availability decreases with age whereas price increases.

The company wanted us to conduct research regarding this very niche to devise a Go-To-Market & Pricing Strategy. The research consisted of the following topics:

• Market Size
• Competitor Analysis
• Customer Analysis

According to the data gathered in the competitor analysis, four key competitors have an annual revenue between $1.0M - $5.0M. This already establishes the fact that this is a double-digit million Pound Market in the UK alone. The prices of UK Shelf Companies are generally cheaper compared to other countries due to the ease of setting up a business in the UK. The market outside the UK is even bigger with a great demand for Shelf Made Offshore companies in the British Virgin Island and other Tax Havens around the world. Without crunching numbers, this is a Billion Dollar Market Internationally

We at Avvale made several recommendations to the company based on the competitor analysis. The prices of the companies can be increased based on the various perks that are added in combination with the registered shelf company. These include a domain name (The company can buy and include the domain in the package. Which will allow the company to charge an additional £100-£200 per year), VAT Registration, Virtual Office Address, and a Catchy/professional sounding name.

The factors that are the most mentioned for customers looking to purchase a Shelf Company were also researched and were found to be speed, certainty, making up for delays, an appealing name, longevity, history, smarter record keeping, better privacy, tax advantages, and low/no personal liability.