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  • Thinking of Buying or Selling Your Website? 7 Important Criteria to Consider!

    14 May 2012

    Sell a WebsiteMy brother, Matthew, and I have been internet entrepreneurs for over 12 years now. In that time, we’ve learned a lot about what works and doesn’t work for making money online. We’ve also learned that what worked yesterday might not work today. But one area that has remained fairly consistent is buying and selling internet properties. We’ve found that, as when buying any business, you must complete your due diligence and consider several key factors when looking at a website for purchase. Most people who want to sell a website are honest, but to avoid the others, and to really determine a fair price, take a look at some of the criteria we consider when we find a website for sale. Every one of them affects the long-term value of a website.

    1. Income: This is pretty obvious, but there’s more to it than just a number. Take a look at the pattern of income over the past year. Has it had a sudden spike? It’s possible that the owners planned some special efforts to make it look better for selling. Is the income trending upward? If not, make sure it’s not a one-trick-pony without a real long-term source of income. Is the income generated in more than one way? If you have product sales, Google ad revenue and banner ads from more than a couple of advertisers, that’s a sign of staying power.

    2. Age: If you want to make sure that the site will continue to hold its value over the long-term, past performance is the best measure of future performance. Look for a site that’s been in play for more than a year. SEO optimization efforts also show their best return at that point. Check out the sites history to see whether it’s been active for that long and to make sure it hasn’t had any problems.

    3. What you’re buying: Are you getting everything that the site offers currently? This may include proprietary software, all of its content, the graphic package and long-term contracts for the ads currently running. All of those add to the potential cost of a site, but also add to its value.

    4. Traffic: This is an area where quality might be more important than quantity. 12,000 hits per day may sound great, but are those potential revenue generators – either through ad revenue or product purchasing – or browsers with zero actual value to you? Issues such as demographics, country of origin, and interest to potential advertisers affect the value of traffic much more than numbers.

    5. Current and potential competition: Does this site offer anything unique enough that it would be hard for someone to create a quick-and-dirty competitive site? This type of barrier to entry is a critical benefit when purchasing a website – actually potentially more important than when buying a brick and mortar business because location is irrelevant. If there are any current competitors, make sure your potential site stacks up well compared to them.

    6. Time and dollars needed to maintain the site as is: Issues such as how much new content the current owners add every week, order fulfillment and responding to queries can affect the real value of the site. Ask about maintenance time and responsibilities, and do your own estimate of how long the same efforts will take you. For example, if you are a fast and competent writer, three new blogs a week may be easy, but if you have to find and hire writers, how much will that cut into your profits?

    7. Potential improvements: Does your special expertise enable you to see untapped potential in the site? Your ability to add value may make a site purchase a bargain in your eyes. Take advantage of that when choosing a site to purchase.

    Just as when you buy any business, there are no guarantees. But with some careful homework, you can find a site that meets your requirements. And if you’re willing to commit to strengthening the site, you can generate some serious income and have an asset with value when you’re ready to sell it to someone else.

    Now that you know what we look for when buying a website, do you have a site you want to sell that falls within our guidelines? If so, click here to tell us more about it!

    Adam Toren is an Award Winning Author, Serial Entrepreneur and Investor. He Co-Founded YoungEntrepreneur.com along with his brother Matthew. Adam is co-author of the newly released book: Small Business, Big Vision: “Lessons on How to Dominate Your Market from Self-Made Entrepreneurs Who Did it Right” and also co-author of Kidpreneurs.

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    9 Responses to Thinking of Buying or Selling Your Website? 7 Important Criteria to Consider!

    1. Georgi Vasilev May 14, 2012 at 11:38 pm #

      I don’t think I would like to sell my online business untill it brings me regular month income. Of course there are cases when the sell is possible – if I need money for other bigger project; if someone offers me very good price; or if there is a emergency need for money.

    2. mark May 15, 2012 at 4:59 pm #

      great work on this post about good biz practices.

    3. John Paul Grant May 15, 2012 at 9:41 pm #

      Great article, good some buddies who are pros at creating and selling websites, they make a living off it … adsenseflippers … good resources to check out to get further details. Anyways great post. We have just started created sites with an eye to selling them in the future.

      • Matthew T May 16, 2012 at 4:40 pm #

        @John Thank you for the positive feedback! You should always have an exit strategy when you startup any business is the rule of thumb I believe in.
        Cheers!

    4. jaywin June 20, 2012 at 2:56 pm #

      Sticking to the evergreen niches I think will always get you the highest return. The quality of the traffic source is crucial. Also if its a blog whose writer has connected with their audience can cause a lot of problems. The audience may not like the new writer(s)/editor.

    5. Hollins July 2, 2012 at 4:56 pm #

      Woah this blog is great i love studying your posts.You realize, a lot of individuals are hunting around for this info, you could help them greatly.

    6. Alex September 17, 2012 at 12:43 am #

      good stuff

    7. Brinda October 11, 2012 at 10:13 am #

      Gr8 blog i got some good tips from your blog . i am having a bad experience with selling my websites . but i will try to follow your tips and hope to get good results.

    8. Jordan October 27, 2012 at 3:43 pm #

      This is a really good post because I really have been thinking a lot about selling my blog. While I do love to try and get what I know out there in the public, it does become a very time-consuming hobby. Thanks to what you have written, however, I do belive that I can increase my blog’s value so that I can get top-dollar if and when I decide to sell!

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