Burts AIS, osCommerce & More Blog
New URL: www.osworld.biz

Wednesday, October 12, 2005

Selling (& buying) websites

As regular readers will know, I'm looking to sell off a few of my web properties - I have a number of sites (both new and established) which I will be looking to sell over the coming months, ranging from small sites (about $100 worth) to large sites ($10k worth)... I've been trying to find a formula that'll allow anyone to work out a guideline price for selling (or buying) a website. Over on Sitepoint, one of the FAQs explains the 12x revenue model thus:

Take the average of the last 4 months revenue. Multiply it by 12 and there's your selling price.
This seems kind of strange as it does not take into account the other assets such as customer lists, website, products and so on. Hmmm. Let's work out the figures, the guideline price for the site that I am looking at selling (under the 12x revenue model) is about 11.5k USD. Which is about right, I think. Perhaps this model is a general rule of thumb that works OK. Now the problem is to find a buyer willing to pay a fair amount for the site! It's a site that I like, it raises a good daily income (average $41 daily for October so far), but is for a product that I have lost my enthusiasm for.

New URL: www.osworld.biz - thanks!

5 Comments:

At 10/12/2005 12:23:00 PM, Anonymous uknowho said...

There are as many oppinions as there are sites for sale on this... at the end of the day, it's what the market is willing to pay.

12 mths is a long time on the net and if your business is predominatly dependant on traffic from one source, like Google, then all that's needed is a Florida-type update to wipe it out... It's a real threat that could happen tomorrow.

Plus, there are several other factors than earnings: Age of the site and its current trading style - I certainly wouldn't pay 12x for a site that was less than 2yrs old in its current trading style - Then there's historical growth-trend allied to possible future expectations blah blah...

Are the earnings net or gross?
Are you providing support? If so, how long and to what extent?
Admin burden?
Support desk burden?
Staff?

The list goes on...

Formula's are great for science but business is more of an art.

 
At 10/12/2005 02:19:00 PM, Blogger -Chance said...

I'll give you $20 bucks for it and call it a day.

If this is the site I am thinking it is, I have lost enthusiasm for it too ;)

 
At 10/13/2005 12:18:00 PM, Blogger baldy said...

Probably not the answer you want, but it is definitely what someone is willing to pay for it.

I'll share my experience of this:

I once sold a website that did not earn a penny directly. However, it was a "driver" by which I mean it described and showcased examples of my work and offered these services but there was no way of buying them directly on the site.

This was in a competetive niche (which Burt knows only too well - osCommerce!) so I knew this site which was established and had consistant traffic from search engines had a value.

Certainly, if you are selling a site that sells products, you should add on a certain amount for these assets (particularly if you created them and they are unique to the site in question).

Tip: I always use Sedo to sell my sites - they have quite a good bid/counter-offer setup, so you can set a high(er) asking price, then a minimum bid to weed out time wasters and negotiate from there.

Good luck with the sale.

 
At 10/13/2005 12:41:00 PM, Blogger Gary B. said...

Baldy - aye, I knew twas you - welcome along! You know, I think I once made an offer for your osC site which you turned down...I think you might have just sold it on so I was a little late...ah well.

I will probably end up keeping the site I'm thinking of selling as it raises a steady income on a daily basis. The high bid so far is $20 from Chance - if anyone can make it $20 + a Snickers Bar it's all yours ;)

 
At 10/13/2005 11:50:00 PM, Blogger richandzhaoyan said...

$20....

Reasonable, Snickers bar - out of the question, never worth it!

Seriously Gary, if its still bringing in a steady income, I would stick with it, particularly if its not involving too much work.

As has been said here, its only worth what people will pay. From a bricks and mortar background, if you want to sell a business, it is the property that is of value. The business could be established for a lot of years with a proven income but the value is still only in the property itself.

I know its crazy but....

With internet sites in particular, I would imagine anyone would be very wary of how quickly it can change - Only a few years ago, I am sure you could have got a slice of google for peanuts! :)

Another couple of years - are they still going to be top dog?

In your case - if it is osC related as hinted (heavily!) there is a alot of unrest and an unpredictable future for osC - If this wasnt the case I may have looked around a bit harder for funding for the snickers bar!

Cheers,
Rich

 

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