How do You Determine Asking Price when You Sell a Website? :: Sell Websites Buy Web Sites

How do You set up Asking Price when You Sell a Website?Reprinted with permission of VotanWeb.comWhen you have in conclusion made the difficult decision to sell your website the first thing that necessarily to be established is the asking price. Setting the asking price is non an arbitrarily process. If a website is priced well be number 1 where it should be, two things exit just about likely happen First, you entrust not sell the business for the get you should and you and or your co-owners/shareholders have been poorly served at best. And second, you might find that you will have more trouble selling it than if priced appropriately higher.If your website is priced too low, it will appear to almost buyers that the deal must be too well-grounded to be true. And we all know what we have been told about that. So beware, low pricing may actually scare away otherwise fire buyers. Of course, it goes without saying that if the website is priced too high then there will be littl e or no interest on the part of safe buyers. An irrational asking price is not going to help you come through your goal of finding a buyer for your website. Now that we have discussed the vastness of pricing and what not to do, let me next say there is no exact science for coming up with an exact asking price. We must deal with a st tend mix of art and science. The best asking price is that which will attract the greatest number of potential buyers. In our effort to determine this optimal price, we must resort to guidelines and rules of thumb. One of the most popular rules of thumb being used today is the Cash-flow or gross Multiple Method. Essentially you multiply your annual pre-tax earnings by well-nigh multiplex of x and you have your price range. When a website has little or no earnings, then a similar method is applied on the revenue number. Both buyers and sellers widely use this method because of the relative uniformity and measurability. Also for buyers, they can eas ily determine their ROI (return on investment) as the multiple can be viewed as some number of years. For instance, XYC.com has annual gain profits of $500,000 and they will use the range of for a low-end of two multiplication (or 2 X as you will often hear) and an upper range of six times.