Tag Archives: E-commerce and Web

Should You Buy Existing E-commerce and Web Based Businesses?

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Most new business owners have made to believe that E-commerce and web based businesses are a low-cost, low-risk path to personal fortune. It is true that an already existing E-commerce and web based business offers a great opportunity to earn money from the comfort of your home. But still, there are many pitfalls awaiting unwary online business purchasers. It is important to educate yourself first about how this industry work. Here are some important things about E-commerce and web based businesses that should help you make a well-informed decision.

Benefits of Buying an Existing Web Based Company
The biggest advantage of buying an existing E-commerce website to buyers is that they can land a great valuation. Other than this, there are some really great benefits of acquiring an already established E-commerce website. An existing business doesn’t have to go through many birthing pains that a newly established business has to go through. All you will have to do to after acquisition to run an existing online company is follow the plan.

Drawbacks To Buying Existing E-Commerce and Web Based Companies
Existing businesses may have some problems. In fact, an existing E-commerce website may be for sale because it is deteriorating, employees inherited with that company may not be suitable, or the previous owner may have created ill will, and its online marketing practices may have become unsuitable, and the existing E-commerce website or web based company that you want to buy may be overpriced.

How To Avoid These Pitfalls?
The only way to avoid these pitfalls when buying an existing web based company is seek advice from a specialist E-commerce business attorney. These professionals can guide you through the commercial and legal considerations. You should also do extensive research about the web based company that you are considering buying. There are many aspects that you need to carefully check, such as traffic sources, traffic volume, brand recognition, and website design & functionality etc. These professionals should also advise you on your free business valuation model and the best legal structure that you should use for your E-commerce website.

Make sure you are familiar with the particular challenges that you may face as an E-commerce entrepreneur. Your E-commerce business solicitor should be able to give you right advice to help you make right decisions. They should be able to guide you through the maze of warranties and indemnities, help with the smooth transfer of intellectual property rights, hosting & domain contracts, customer database supplier leads, and distribution agreements. They should also help you secure unquestionable and non-compete clauses. Hiring E-commerce advisers and attorneys is a surefire way to avoid all those pitfalls that may be associated with purchase of the existing E-commerce and web based businesses.

On the whole, it is true that E-commerce is a fast-growing, multi-million dollar industry. However, there are some pitfalls associated with it. If you are considering buying an already existing E-commerce and web based company, it is important to do your homework first in order to avoid these pitfalls.

What To Look For When Buying E-commerce and Web based Businesses?

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More and more people are showing their interest in owning E-commerce and web based businesses. If you also want to join this industry, it is important to note that buying an online business is a lot different than buying a brick and motor company. For example, the due diligence process when purchasing a brick and motor company is very hectic and can be complicated, but the due diligence process for an E-commerce and web based company is easier. If you are determined about purchasing an E-commerce website, there are some important pointers you need to look at. Let’s have a look at them.

Do Thorough Research To Understand Your Market
The most important thing when buying an E-commerce company is your target market. How well do you understand your target market will have a very strong impact on your buying decision. Some important tools and practices that you can use to understand the market include these:

  • Similar sites and web based companies on different marketplaces like Flippa.
  • Identify closest competitors and take your time to study their websites, mobile sites and social media profiles. Look for customer feedback and reviews about them. This will help you get an idea about the competition level. Also this practice will help you identify the good and bad sides of your competitors.
  • Is there a market for your ideas? What is the size of that market? If you are looking for a solid opportunity, go for the already established markets that are still young and growing. If you can service smarter, you can dominate that specific market with your ideas.
  • If you are purchasing an online business that is already trading, check its analytics. An honest seller will not hesitate to show you the full analytics. Analytics play a very vital role because they tell you everything about the performance, demand and popularity of business that you are buying. So, carefully check Google analytics in order to see the traffic sources, traffic levels and key words and phrases that are bringing the traffic to the E-commerce and web based companies you are considering business for sale.
  • Another very important thing that you need to check is legality and originality of E-commerce and web based company that you want to buy. There are some features that every legit and original E-commerce business possess. One of these features include original, useful, engaging and legal content. When looking at this feature make sure you check the consistency of the content in accordance with the information gathered on top keywords and landing page content. Another feature is ownership of database lists. When looking at this feature make sure your selected E-commerce company has selected data legally in all operating geographies.
  • One of the most important factors that you need to check is the reason for the sale. An honest seller will not hesitate to tell you the genuine reason for the sale. However, no seller will be 100% honest with you. At this point, the key to success is to look for the potential and understand why the seller is struggling and you can do better with their business after acquisition.

These were just a few of the many important factors that you should look at when buying E-commerce and web based businesses.