How can you make your online store find a new owner faster?
Write Down What you Are Selling Online stores, even those operating in the same market, can be very different from each other - both in terms of the scale of activity and the assets included in the project. Potential investors may be interested in different things: one needs a well-publicized domain with a good search engine output, and the other - contracts with suppliers of goods, concluded on favorable terms. The more accurate and complete the list of components of your business, the faster you will find a buyer and close the deal. This is an individual job, because only you know exactly what the project has "under the hood". Below is a non-exhaustive list of the things that can make up a business of selling goods online: ● domain name ● customer database ● site design and interface ● registered trademark ● valid contracts with suppliers ● inventory balance ● logistics system ● social media accounts ● advertising accounts ● automated marketing ● the phone number that customers call ● trained staff ● legal entity Identify The Target Audience And Articulate The Value Of The Business An exhaustive list of assets is an important step towards selling the business, but now it is important to determine what will interest the buyer in these assets. This is not obvious, as you and the investor may have different views on the importance of the project components. Try to take the buyer's place and think about how your online store will differ from many similar offers, to whom and why it may be interesting. Formulate a few value propositions in terms of benefits for the investor and try to imagine who could become this investor. Calculate The Price Having worked through the value proposition and selected the target group of buyers, proceed to determining the price. There are many ways to evaluate your business based on financial indicators such as turnover, profit, EBITDA and others. If you are confident in the figures, then, for example, the net profit for the year will be an excellent reference point for the value of the company. However, it should be remembered that transactions take place when the price offered by the seller suits the buyer. For a confident dialogue with the investor, it is better to estimate the value in several ways. Base your calculations on the buyer's goals - if you know exactly what the investor will pay for, it will not be difficult to determine the cash equivalent. Prepare A Management Report For The Buyer Buyers of business are interested in the figures - metrics and indicators characterizing the operating activity of the enterprise. It is not necessarily about finance only: in the above example of an online store with the value in the form of a good search engine output is more important than attendance, conversion, and cost of attracting the user in advertising channels. The eCommerce dashboard will help to demonstrate to the investor that you control your business performance with a table like this. Describe Business Processes And Eliminate Of Being One Of Them Any business is a set of processes taking place within it. At the online store, it is, for example, placing an order with the supplier, delivery of goods to the buyer, and testing the title on the home page of the site. For the buyer of the business, it is important that all the processes were described in as much detail as possible, step by step, indicating the contact persons involved at each stage. Re-Execute Accounts Online stores use many different services and applications, such as CRM, hosting, contextual advertising, marketing automation, email newsletters, social networks, web analytics, and others. Make a complete list of such services with logins and passwords to access them. If the access is organized through personal e-mail, it is necessary to re- register their special email, which, in turn, will be transferred to the buyer. Pay Attention To Legal Issues Collect company documents in one folder and scan them - the customer will need copies for preliminary study. If you are selling a company that has already been involved in such transactions, make sure you have the documents to prove the legitimacy of the previous changes - extracts and sales contracts. Pay special attention to copyright issues on the software code, design, and content of the site. For each type of intellectual property, you should have a contract with the author indicating the type and cost of work and signed by the parties to the act of acceptance and transfer with the consent of the performer to waive the rights to the result of work in favor of the customer. A sample contract and service act can be found here. Think About Safety Think about who and at what point you can learn about your intention to sell the business. Information about the upcoming transaction can be harmful to relations with employees and counterparties. Imagine if your plans are known to a key supplier who ships goods with deferred payment. Without knowing who will become the new owner, the partner is likely to decide to reduce their own risks and will require advance payment for another shipment of goods. Find A Buyer! To find a buyer, you can contact a professional business broker or try to sell an online store by yourself, directly offering the asset to potential buyers. In any case, proceed from the formulated value for a specific target audience. It makes no sense to offer business to everyone: it will most likely lead to a decrease in the amount of the transaction (the non-targeted buyer will not be able to appreciate the asset at its true value), and to the likely negative emotions of a non-professional investor who will not be able to get the maximum benefit from the transaction.