How to Determine your Website's Value

If your website has been up and running for over six months, you need to know how much it's worth on the open market, whether or not you are intending to keep it. Only then can you amend your future direction realistically. Unfortunately, there isn't an industry recognised method of appraising the value of a website. You have to do the research and demonstrate that you're worth the asking price if you're looking to sell.

Browse websites for sale

Start by browsing websites for sale. BuySellWebsite.com and WebsiteBroker.com are two of the biggest website selling portals online. There may not be any websites for sale in exactly the same market as you, but there will be sites with a similar level of statistics. Visit these websites and try to establish whether or not they're doing anything different from you. Bear in mind that some sites listed will never sell because their expectations are unrealistic.

Focus on the tangible

Your website is only worth something if somebody wants to buy it. To make somebody want to buy it, you have to show him or her that it's worth the price. If you know all this information off the top of your head, you'll either be highly knowledgeable of the factors used to determine your website value, or know what you have to do to create a valuable commodity. The following are the ten tangible areas to focus on:

1) Your present monthly income
2) Your past and present profit, loss and costs
3) Your creditors (who you owe money to)
4) Your owned IP (Intellectual Property) such as trademarks and copyright
5) Any history of, or pending, litigation
6) Your website's technical requirements, original software and graphics
7) Whether or not your business model is easy to understand and replicate
Your reliance on specialist knowledge or an existing individual relationship
9) Your database of existing customers including history of interaction
10) Your willingness to take part in a lengthy business handover

Speak to prospective buyers

Until you speak to prospective buyers, you're only guessing at how much you're site's worth. I'm talking about speaking to people over the phone, and not a cyber relationship. You need to speak to people at the top of relevant organizations. Presidents, CEO's and Managing Directors are just ordinary people with great focus. They want to talk specifics, so even if you're a single owner / operator website, as long as if you know your 'ten tangibles' the chances are that they'll be happy to take your call. If you're lucky, they'll also give you some advice on the sort of 'due diligence' they perform while purchasing a small business. Even if they aren't interested, you'll have a much better idea of the present value of your website, and what you have to do to make it more appealing.

David Bain is founder of the independent business articles resource, http://www.BuildYourOwnBusiness.biz. BuildYourOwnBusiness offers the latest business news & management advice on how best to build your own business - business articles on Strategy, eBusiness, Change Management & much, much more.

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