Member Article

How to Find the Right Website to Buy

While buying a website might seem like a relatively simple process, it’s an investment which must be approached with care.

There is usually plenty of information available - even without approaching the seller - but it’s important to remind yourself you won’t be able to rely upon the same established protocols as a bricks and mortar purchase.

Here’s some things you must consider before taking the plunge:

What kind of web business do you want?

Just like on the high street, web businesses can address different sectors and appear in different formats.

So, while you will definitely need to be tech savvy, understand online marketing concepts and be prepared to continue learning just to stay up to date, you will still need skills appropriate to the sector you plan to focus on.

Irrespective of whether it’s an online or offline environment, you will always need a good grounding in the business you want to run.

The best strategy is to follow your interests or choose something you are ready to become immersed in. And remember that whilst a tabloid news website, for example, may prove to be a 100% online experience, a successful e-commerce business (much like its high street counterpart) may well involve acquiring stock, dealing with a supply chain and may have staffing implications too.

Knowing the right questions to ask

Due diligence of any kind always places the responsibility of making proper checks on the buyer.

Therefore, as with any other kind of business due diligence, you should look to those with expertise in the sector for advice.

Just as an accountant will know how to test and verify the figures on a balance sheet, a technical website auditor will know how to probe and evaluate website traffic statistics.

The number of site visitors is clearly important, though exactly what counts as the key performance indicator (KPI) will be specific to each business. Though information about traffic analytics is freely available, once again, it takes in-depth knowledge and experience to know precisely how to interpret this kind of raw data.

In addition, you and your team will need to substantiate ownership of the website you plan to purchase, track its domain history, explore the quality and validity of site backlinks as well as making enquiries about the various additional revenue streams the site currently attracts.

It will also be necessary to establish the site running costs as these will, of course, impact upon any calculation of profits.

Elsewhere, there may be other legal issues to consider, perhaps involving intellectual copyrights associated with software or ownership of third-party content which may appear on the site.

Site development

Having acquired your chosen site and verified that is profitable, you can then begin a site review to optimise its potential revenue.

E-commerce experts agree that finding marginal gains is the best way to make a website more profitable. This approach focuses on making small adjustments in several areas.

Such improvements will increase the traffic to your site, which can have a big impact on overall performance of your website and profits.

Measures to consider include an audit of the product range to determine what sells best, and what simply takes up shelf space. Making additions inspired by successful products, while discontinuing poor sellers, should improve your profit margins.

And likewise, an audit of your suppliers may reveal alternative sources which could be cheaper, or at least give you the opportunity to re-negotiate supplier contracts.

Though it requires specialist knowledge (and could be outsourced) a review of your search engine optimisation (SEO) could vastly improve your user experience and place your site higher in the Google search listings - another win-win situation.

Much the same applies to your website’s presence on social media, which can also be reviewed and optimised to boost the reputation of your business, a measure which is sure to have a positive effect on your site popularity and your sales and revenues.

Website due diligence may seem very different to the due diligence performed where a traditional business is involved. However, it’s just as necessary to protect your interests and means your final purchase decision will always be based on solid evidence.

By Jo Thornley, Head of Brand and Partnerships at Dynamis. Joining in 2005 to co-ordinate PR and communications and produce editorial across all business brands. She earned her spurs managing the communications strategy and now creates and develops partnerships between BusinessesForSale.com, FranchiseSales.com and PropertySales.com and like-minded companies.

This was posted in Bdaily's Members' News section by BusinessesForSale .