If you have decided and are committed to selling your website, your goal would obviously be selling it quickly to the most qualified buyer. That may sound easy, but it’s not. The truth is, your website must be worthy of buying, and even then, you must do a few things to get the best deal out of it. So what information would come in handy when you want to sell your website? Let’s check out these 5 tips that should guide you through.
To know how much you’d be willing to sell your site for, you must do a website valuation exercise. This is not really a complicated process; you simply base your value on an earnings multiple. Typically, websites sell at 1-3x their yearly earnings, or 12-36x their monthly earnings. The final price that the buyer is willing to pay will be anywhere within this range.
But one big question: is your website an investment a buyer would be willing to acquire? It should, if you can demonstrate the following:
- A good, consistent income
- A positive growth trend
- Potential for growth
- Multiple revenue streams
- Automated systems/processes
- Assets: traffic, email list, premium domain, advertisers etc.
If all of those things are looking good at the moment, then you have a winner. What you need to do now is to fine-tune your site to improve its earnings. Simply put, optimize!
A common mistake that you’ll find with many website sellers is that they are very excitable, and therefore only think about the short term. If you would take the time and effort to optimize your website to hit its near-full earnings potential, then you’ll be rewarded with much more money. There’s nothing worse than a buyer looking at a website that’s been barely optimized to maximize profits. That’s because they might decide to buy it, but at a fraction of its true value. And that would be a costly error on your part.
Try out any different ad networks, ad units, ad placements, more monetization methods, improved call-to action, better website copy, and then watch the results. You’d be surprised that your website’s value can rise threefold.
3. Do your Homework
Your homework, after optimization, is to prepare the documents to be used as marketing material and for the sale itself. The main document here is an information memorandum that explains to buyers everything about your site: traffic history, revenue, profits, products and services, operations, FAQs… You also need to check your legal position. Look at your contracts, licenses, tax filings, financial reports and other legal documentation tied to the website. In case of a sale, will the handover be smooth or will you run into problems with the law?
This is when using a website broker can help you save time. Having a website broker taking care of finding qualified buyers for your site, preparing the documentation and facilitating the transition is necessary if you do not have the time – and resources – to do all that by yourself.
4. Use Escrow
Whether selling your website through a broker or using Flippa.com (or other marketplaces), an escrow service has become an industry standard. The most popular online service is Escrow.com. Another is Safefunds.com.
Escrow guarantees safety for both the buyer and seller when transacting business. How it works? The buyer agrees terms with the seller and inspects the website, before releasing the money to Escrow. The seller then ships the product to the buyer, and the buyer accepts it. Escrow now pays the seller and the transaction is completed.
5. Attract the Right Buyer Audience
Finally, you can save yourself a lot of frustration by focusing your sales effort on outlets that will attract the kind of audience you need. Listing your website on EBay will only bring in a large general audience, without a single soul willing to meet your valuation. Flippa would a better option.
Website brokers also have access to a broader pool qualified buyers. Do some basic research to find out other options that can suit you. It’s also a good idea to research successful website sales for inspiration and to find out how they did it.