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Site Flip is the Web's first blog dedicated to the business of flipping websites! Flipping means buying a website, improving it, and finally selling the website for a profit.

Site Flip: Buying and Selling Websites for Profit

Thursday, August 10, 2006

Business For Sale vs Web Site for Sale

Surfing the Web today, I found that a "business for sale" generally goes for much more than a "Web site for sale." Naturally, this is of interest to site flippers looking to make the biggest bucks from their site flipping. (If you enjoy the read, consider my free newsletter.)

Google business for sale and you'll find that franchises and other businesses are selling for tens or hundreds of thousands of dollars. By contrast, most established websites for sale at places like Website Auction Hub go for a few hundred to a couple of thousand dollars.

Several thoughts and comments come to mind when I consider this state of affairs in the business and web site world.

First, it raises a traditional question in business planning: will you sell volume or will you sell quality? By volume, I'm referring to micro-businesses, such as websites that generate income in the double digits on a monthly basis. By quality, I mean mostly bricks and mortar businesses that have a high trust factor, and generate income in the hundreds or thousands of dollars monthly.

Second, if people are willing to sell "web sites" much cheaper than they're selling "businesses," the opportunity for the site flipper's wet dream arises. The opportunity can be summarized as follows. Given the differences in pricing between the "web site for sale" market and the "business for sale" market, site flippers can buy on the web site for sale market with the idea of reselling it soon after on the business for sale market.

This is the basic idea behind house flipping: buy a house, and resell it quickly. Except that laws make house flipping illegal (agents can be sued for not getting the best price possible). Chances are, the internet will be regulated like any other industry (domain registries being a good example of some early regulating).

A third issue this raises are the long term prospects for the "web sites for sale" market. Someone is bound to fuse the business- and web site-for-sale markets. When this happens, the law of supply and demand means that web site prices will increase, while business prices will decrease. A new equilibrium will be reached in the market where the above-mentioned opportunity will dissapear. And if the market doesn't take care of it, government will.

Fourth, I wonder if the business for sale market is as succesful at finding buyers for sellers as the website market is. This will affect the equilibrium reached when the two markets merge. It might also prove meaningful to site flippers whose pockets aren't that deep, as selling a business usually entails more costs than selling a web site does. Listing fees alone are 2 times more expensive, at least.

Last, and most importantly, I encourage my fellow Site Flippers to immediately involve themselves with the web site market as deeply as they can. The window of opportunity to profit from the current parallel business for sale and web site for sale markets is shrinking by the minute, as even the mainstream media report the "news" about our industry.

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  • At 6:02 PM, Blogger William said…

    Hey Webmaster. How about a link trade?

  • At 12:57 PM, Blogger Mark Martin said…

    Hey there! Keep it up!Thank you so much for sharing a post about this topic. You have such a very interesting and informative page. I am looking forward to visit your page again and to read some of your other posts as well.I am glad that I have an added learning from your blog.
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  • At 6:25 AM, Blogger Jackie Champion said…

    Hello! This is a good read. I will be looking forward to visit your page again and for your other posts as well. Thank you for sharing your thoughts about business for sale in your area. I am glad to stop by your site and know more about business for sale. Keep it up!
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    Our affiliation with NAI Global enables us to tap into a global network and utilize a broader range of expertise. NAI Global works with institutions and private investors seeking to maximize their real estate position and portfolio strategy.

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