Over the years, there has been a continuous drive towards digitalisation and an even greater push for online activity from the pandemic. We have therefore seen a growth in the amount of eCommerce businesses trading and the associated demand from buyers looking to purchase their next online opportunity.
Are you looking to sell? Or just looking towards a possible future sale? Keep reading to find out the best tips on how to sell your eCommerce business and get the most out of your sale.
Tip 1: Ensure Your Site is Prepared for Sale
As an eCommerce business, your most prized possession is your website. This is the first place prospective buyers are going to look when considering your business for purchase.
Hence, you will want to ensure that your sites UI and UX are at their optimum. If a prospective buyer is having trouble navigating through your site or isn’t pleased by the look of it, then it is clear to them that customers won’t like this either. This only means more work for them after they have acquired your business. **Therefore also impacting sale price.
We can compare this to buying a second-hand car; It’s a lot more appealing when a car has been looked after and has had its regular maintenance. There’s a difference between adding in an air freshener, compared to replacing all 4 tires. And the same can be applied to your website; it’s a lot more valuable to prospective buyers when there is less back end work to do.
When considering how to sell your eCommerce business, you’ll also want to make sure your financials are in order.
Tip 2: Get Your Financials in Order
Depending on the size of your eCommerce platform, you may be handling all the accounting and finance on your own. Whether this is through a manual method such as a spreadsheet or an accounting software such as Xero.
If this is the case, and you have been managing all of this on your own, it is not a bad idea to get a professional in before proceeding to sell. There is no need here to hire a new employee, outsourcing is the best way and is common practice for this to be done through a 3rd party. Think about it, a lot of people will be viewing your financials throughout the sales process; prospective buyers, accountants, lawyers, advisors and more.
Not to mention, any mistakes in financials can be extremely detrimental to the ale of your eCommerce business. This can appear deceitful or inaccurate to buyers and leave a bad impression on other areas of your business.
You will need to have the following financials at hand (at minimum):
- Tax returns (3 years)
- Income statement
- Balance sheet
- Cash flow statement
From your financials to your customer data, organisation is key when considering how to sell your eCommerce business.
Tip 3: Make Sure Your Customer Data is Organised
Similar to your financials, you will want to ensure that your existing customer list is in order. This is valuable information for the next business owner particularly in the eCommerce landscape, therefore making this a major selling point.
It is much easier to target promotions and marketing campaigns towards an existing customer base. In order to make this as simple as possible for the next business owner you will want to make sure this information is accurate and up to date;
- Remove double ups,
- Delete cold contacts
- Segment your database correctly
Now let’s get back to the basics…
Tip 4: Continue to Run Your Business as Usual
Selling a business is a lengthy process, it is not just something that happens from one day to the next.
This is exactly why you shouldn’t let the sales process deter you from running the show as per usual. At the end of the day, you are still the owner and reap the benefits of profits. Not to mention you want to keep your records consistent for prospective buyers.
Continue to find new means to boost profits and drive traffic to your site. This will only assist in making the business more valuable to potential owners.
Figuring out how to sell your eCommerce business is no walk in the park, hence why it is recommended to consult with an expert.
Tip 5: Consult With an Expert
How much is my eCommerce business worth? Where will I sell this platform? How do I reach the right buyers? These are all some of the many questions you may be asking yourself.
And, although you might think you know the value of your business or how to handle the sale on your own, chances are you probably don’t. Especially with valuation, you seriously run the risk of listing your site at a price that is too high or too low.
It’s okay to drop your ego and reach out to a professional business advisor who can provide you with a clear valuation. They will be able to provide you with a detailed report related to this figure, giving you even greater credibility for sale. Not to mention, your advisor will be able to help you throughout the entire process from preparation to sale to ensure you get the best value for all of your hard work.
To give you a bit of an idea, here are some factors which contribute to the valuation of an eCommerce business:
- Customer service
- Business age
Looking for guidance on how to sell your eCommerce business? Our financial advisors are experts in selling businesses – from valuation to marketing your business to prospective buyers, all the way through to completion of the sales process.
Contact us here to find out how we can help you get the best sales outcome for your business.
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