Use this checklist to assess businesses in this industry for SBA 7(a) lending and underwriting.

🏷️ Platform Dependence + Sales Channels

• Are sales concentrated on one platform (Amazon, Etsy, etc.)?
• Does the business have direct access to customer data?
• Is there a branded website or diversified traffic sources?
• Are platform policies or rankings a key revenue driver?

📊 Inventory + COGS Controls

• Is inventory itemized, valued accurately, and aged appropriately?
• Are there controls for shrinkage, returns, and obsolescence?
• Has COGS been matched correctly to revenue?
• Is inventory overstated or lumped into goodwill?

👨‍💼 Owner Role + Labor Normalization

• Does the owner handle fulfillment, sourcing, or marketing?
• Are virtual assistants or contractors used?
• Has a market wage been applied for owner tasks?
• Is there a transition or outsourcing plan post-sale?

📄 Tech Stack + Fulfillment Review

• What platforms, apps, and integrations are used?
• Are fulfillment services (e.g., FBA, 3PL) stable and documented?
• Are supplier and logistics relationships transferable?
• Is the business at risk due to vendor concentration?

🚩 Red Flags

• Platform-exclusive (no website, no customer list)
• Inventory estimated, not audited
• Addbacks = photography gear, lifestyle travel, software trials
• No SOPs or tech documentation for buyers

📌 SBA SOP Tip

E-commerce businesses must reflect accurate inventory treatment, normalized platform risk, and transferrable infrastructure. Cash flow should be adjusted for logistics, owner input, and advertising dependencies.