Smp Business Hosting — Thu, 04 Oct 2007 07:33:11 +0000

babrees;224895 wrote: Thank you - that is perfect! I am just waiting for him to come back with figures of earnings and membership and confirm visitors - that's all I'm interested in as I will be totally redoing the site.

Cheers!

Jill

You are more than welcome.

Just make sure that you find out both his turnover and profit, the turnover is trivial without knowing the height of expenses. Some companies have a turnover in the millions but make little profit hence the saying "turnover is vanity profit is sanity".

Also I forgot to mention in my last post that the value of assets play a big part in the equation this includes the domain, script and anything else that comes with the deal.

If you have any further questions feel free to fire away or PM me.

Regards, Steve

babrees — Thu, 04 Oct 2007 06:48:42 +0000

Smp Business Hosting;224892 wrote:
I have a rule of thumb that I won't buy a business for more than 1 years turn over if it is in very good standing and no more than 1 years profit if it will require renovation to make it work or stable.

Thank you - that is perfect! I am just waiting for him to come back with figures of earnings and membership and confirm visitors - that's all I'm interested in as I will be totally redoing the site.

Cheers!

Jill

Smp Business Hosting — Thu, 04 Oct 2007 06:12:13 +0000

Hi Jill,

Yes it is a little like asking how long is a piece of string.
The biggest factors when pricing a site or business is a) turnover and profit b) quality of users/ customers c) how long it has been established d) monthly visitors & unique visitors e) reason for sale and the list goes on. But really it's only worth what a buyer is willing to pay after looking at the factors.

I have a rule of thumb that I won't buy a business for more than 1 years turn over if it is in very good standing and no more than 1 years profit if it will require renovation to make it work or stable. Turnover is vanity profit is sanity! I want to make my money back as soon as I physically can so the cheaper the better, but if I go too cheap I could loose the sale.

Without knowing an awful lot about it, it would be hard to put a price tag on it.

My best advise is find out as much about it as possible and try to get as much proof as you can to back up his claims e.g. webstats ect. Then make a modest offer that you are willing to pay. You're making an investment in it, how long do you want to wait until you get your return and how long will it take you to get it?