Ive been around DP for about 2 years now I believe.. I have purchased and sold websites here.. I visit sitepoint alot, and I know about all the sites that "claim" they can place a value on your domain and site. While most of this isnt "Real" Business practice anyways.. Im just curious if anyone WHO TRULY knows - How to place a price tag on a website and why. I will even give you a realistic scenario - I have a site, it ranks #1 for a nice niche term.. I get 6500 visitors a month, about 3-4 TRUE leads a month. I bring in about 900-1200 a month. With marketing, and more people.. It would bring in 3 times that. Business wise, I would multiply the annual earnings by 4-5 and sell it at that. Unfortunately, most would disagree. Why ? Furthermore FOR DISCUSSION, If the bank or an investor was to see the website as an actual asset - What could I price it at? Do not place a stupid link in my thread - Based on whatever.com sites are worth this. If they dont have access to your bank account with deposits, they dont know jack about how much my business makes. NOVA~
How to price a website - how much it is making and how much it can make potentially. Somewhere between these 2 factors is the price point.
Hi Nova, While I can't say that I'm an "expert" in putting a value on a website, I can say with certainty that no matter what you are selling...it's only worth what someone is willing to pay. It boils down to negotiation. It helps that you have statistics to show what income and traffic you are getting. It's a great starting point to get people thinking about the "value" of it. There really isn't a set formula. Put your price tag on it, get qualified leads and start negotiating. Just remember that investors are looking for a quick return. If you are producing an average of $900 per month I think that you would be hard pressed to get $900x60 ($900 per month x 5 years) because there is ZERO return for 5 years if the sales stay the same let alone if sales start to drop. If you were to ask $54,000 for the business you would probably want to show them a return of something closer to $250,000 over 5 years rather than just simply getting their money back in 5 years. So.... Perhaps you should consider selling $18,000 so that you can show them how to triple their money. Maybe that's not enough enticement. You have to consider the time cost in running the biz too. There are many variables to consider when selling an existing business. You'll never know until you get it out there with a solid sales pitch and some negotiation room. Also, make sure you know your bottom line. Sometimes it just makes more sense to keep the business for the cashflow if it doesn't make sense to sell lower than you're comfortable with.