Preparing a Website for Sale :: Sell Websites Buy Websites

Preparing a Website for Sale Reprinted with permission of VotanWeb.comA website proprietor recently asked me to succinctly define what an owner must do in order to prepare a website for sales agreement. I segmented my response into major(ip) categories as followsFinancialSince most website sales are based upon a multiple of the interchange flow (either EBITDA or Discretionary Cash Flow), the website owner must have entirely of the financial records segregated and in keen order. At a minimum, we would suggest having three years of financial statements and assess returns. If there are substantial differences between taskable income and book income (e.g. cash belowcoat vs. accrual), those must be identified and explained. Culling out all satisfying discretionary expenditures along with isolating any unusual and non-recurring expenditures and losses allow be outstanding.OperationsThe Seller will want to identify all crossways and services provided by his (her) website an d the specific markets served. In this review, it will be important to define the strategic advantages enjoyed by the website in their respective niche as well as comparative gross profit margins for each product and service.Growth OpportunitiesWhile buyers will purchase a website at a price predicated on up-to-the-minute and historical cash flows, the main nervous impulse for the purchase will be the ability of the buyer to grow the website at a rate that exceeds the norm for similar opportunities. It is important for the Seller to meet those growth possibilities and define them tangibly in terms of product extensions to current lines, existing products to new markets, better market penetration, wider geographical distribution and etc.Deal StructureThe preponderance of transactions in the sale of in camera held website are handled as an asset sale (versus sale of stock). This type of sale will result in the buyer receiving a stepped up basis in the assets purchased (which g enerates future tax deductions) while concurrently avoiding unwanted dependant upon(p) liabilities that result from a stock sale. The owner must sit good deal with his CPA and/or attorney and understand the tax implications of this transaction under each scenario so that he will not be affect at goal or worse yet, when preparing his individual and corporate tax return. Remember, its not what you get but what you keep that countsAvailable Financing approximately website owners would prefer to be cashed out of the transaction at closing and do as little owner financing as possible.