'Net Features : Flippa

Is 2013 The Year to Sell Your E-Commerce Store?

Administrator — Mon, 18 Feb 2013 18:15:00 GMT

By Dave Slutzkin, CEO, Flippa

Timing really is everything, and knowing when to sell your business means the difference between cutting your losses and having the cash to fund your next big idea. At Flippa, a website marketplace, we see the fruits of well-planned exit strategies every day, executed by savvy business men and women who know when to unload their assets to the highest bidder and start anew. So how do you know when the time is right to sell your e-commerce site? It's a harmonic merger between your business metrics and the market itself. Let's see if 2013 is your year for serious change.

The reports on the current state of the U.S. economy are conflicting, so let's talk about what we do know. According to a new report from eMarketer, e-commerce is now a trillion dollar industry. This year, global e-commerce sales are expected to top out at $1.298 trillion, another 18.3 percent of revenue growth. North America continues to dominate the lion's share, but Asia-Pacific sales are expected to see the highest percentage of growth at 30 percent, equaling $433 billion in sales - and as soon as 2016, this region may actually surpass the U.S. in sales.

With the epic projections in the market, many signs look ripe to unload your store, but consider these factors before you scramble to let your business go to the highest bidder.

Size Up the Competition

Everything from base URLs to full-scale successful Web business go up for sale every day. It's abundantly clear to any serious buyer which sellers have done their homework and which simply wish to unload.

The number one place your due diligence is reflected? The asking price. Scour the Web to find similar businesses for sale, and those recently sold as well. Study not only the selling price, but also the initial asking, all included assets, valuations, services (the whole kit and caboodle). Be very wary of undervaluing your e-commerce store, and equally cautious not to price yourself out of the market. This takes objective research and sincere integrity - and it truly is the key to your success.

Know Your Buyer

A thorough understanding of the demographic you are serving helps you to target all marketing materials and sales proposals to exactly the kind of buyer you need. Remember that it's not just about what you're selling, but also how you present the offering. A balance between necessary metrics and discretion is required, as some details of your business may be better left confidential. Have a solid non-disclosure agreement (NDA) ready to share with truly interested and capable buyers, and above all else, be honest about every last detail. Nothing spoils a deal faster than a buyer discovering a trail of deception does. Treat them just as you would a loyal customer - with warmth, respect and integrity.

Website marketplaces are invaluable in finding potential buyers. Investigate ones with a broad reach and any niche-specific communities that focus precisely on your business's expertise. Don't forget to use the power of social media to get the word out on your sale - friends and family may also be motivated to help you close the deal, so don't be shy about reaching out.

Finally, consider how you will accept payment. Are you offering financing? If at all possible, find a way to do so. The credit crisis is still very real in our economy, and your pool of buyers will broaden significantly if you are able to offer flexibility and payment plans. Consider, too, that it may lessen the tax burden on you if you receive the asking price in installments, spread out over a year or more. Offering financing also justifies an increase in the asking price, so it's truly a win-win.

Issues and Exit Strategies

Before you get ready to sell your e-commerce store, consider your biggest challenges so far. Document problems encountered with any aspect of the business you've uncovered, including marketing efforts, design, user base, retention, SEO and technology. Share why you are selling the business, as serious buyers will most certainly ask. Outline your exit strategy too, including timeline, all documents and materials, software and technologies, art assets and personnel that may or may not make the shift. Gather all expense reports, tax returns, income statements, and related documents in one easy-to-share location. Don't wait for an interested party to ask for these as it may take some time to get things organized, depending on how meticulous you've run the business thus far.

The latest eMarketer report states that the e-commerce industry in the United States will grow from $343 billion in 2012 to $385 billion in 2013. Is this explosion alone enough to spell success to your potential sale? That's a question only you can answer. If you're feeling the itch to move on, the numbers support you - just make sure your business reflects the same, considering all sides and factors. Best of luck on your decision, and may your year be prosperous!

Who Is Powering the Internet?

Amberly Dressler — Wed, 21 Nov 2012 16:30:00 GMT

That’s the question Flippa, a marketplace for buying and selling websites, looked to answer when the company took more than $26 million in transactions from the last 18 months (Oct. 2012) to work out what technologies are used to power the Internet, and how this has changed in the last 12 months.

The company’s findings should prove to be particularly useful and interesting to e-commerce startups, bloggers and digital marketers, as the data shows some mainstays for development and e-commerce falling by the wayside.

For example, in the e-commerce realm, the demand for eBay's Magento (read about their most recent updates here) and Yahoo Store continues to weaken at the expense of challengers such as Shopify and BigCommerce.

According to the data, Blogger also appears to be in perpetual decline, as for Content Management Systems, it accounted for the supply of just 1 percent of those transactions.

To read about the learnings from $26 million in website sales, click here.

gFlip Enters the Domain Game

Michael Garrity — Fri, 02 Sep 2011 18:00:00 GMT

Owning a domain name and listing a website online can get pretty expensive, especially when you factor in both listing and success fees, but today sees the rise of a new website marketplace, gFlip, that promises to list your site for free.

gFlip will "allow their users to list and sell there [sic] websites completely free of charge," according to a press release from the company. "Where as [sic] other website marketplaces charge their users fees for using there [sic] services."

This means that you can now list your website on gFlip totally free, and they don't charge success fees, which are the fees charged when a property sells successfully on a website marketplace. gFlip is now the world's first completely free website marketplace.

On average, domain name listings will typically run from about $10-$25 a year to list, although some expert searching can find prices both lower and higher.

If you're willing to shell out a little cash for a more proven website marketplace, however, there are other options out there. These sites all work the same as gFlip, where sellers register (and, in these cases, pay for) a listing and then set a minimum fee. Buyers then come in and bid on the domain, auction-style. There are other buying and selling options available that are specific to each site, but this is the standard method.

Here are three of the most popular website marketplaces:

Sedo
Sedo is one of the most highly-recommended domain name hosting sites on the Web. It is also one of the only companies out there that offers multi-lingual domain specialists who are fluent in over 20 different language. They charge a $69 retainer fee for hiring a Sedo Domain Broker to buy a domain, and take a 15% commission fee of the gross purchase price of a successful sale.

Afternic
This is another proven domain listing site who promise 5% cash back on your domains and offer what they claim are the lowest sales commissions in the industry. They also partner with over twenty other sites around the world, which means you have a much larger buying audience.

Flippa
Flippa is probably the most recognizable name on this list. While Flippa does charge success fees, they also have the option of allowing sellers to play a flat fee when first listing a property, but this is only worth it if you can be confident that your domain will sell at a high value. Like the others, Flippa is auction-based, although it, too, has the option of making private transactions.

Web Hosts and the Domain Market

Pete Prestipino — Wed, 20 Jan 2010 00:00:00 GMT

The potential revenue streams within the domain market can no longer be ignored by Web hosts, registrars and service providers. At the same time, there is often concern that working with the domain market will direct customers to competitor offerings, and result in loss of customer loyalty and revenue. Fortunately, there are several innovative ways for registrars to actually improve customer loyalty and revenue through new partnerships.

READ NOW: Web Hosts Add Value by Integrating with the Domain Market by Jeremiah Johnston of SEDO

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