Selling an Ecommerce Business

The difference between Ecommerce and regular businesses is that you are selling an internet business when it is Ecommerce.

Ecommerce stands for electronic commerce in which you are selling products or services via computer internet connection. You may not have a physical location, just an online identity. Typically with an online business what you have to sell is a little different. You may have inventory products, but often you will not sell your business account for financial funds i.e. you will not sell the Paypal or other financial account tied to the business. Instead the new owner will have to set up their own transaction account. You may sell the shopping cart account and the security account. Often the online transaction processing like Paypal is the only thing you cannot sell. You can sell the inventory management system, email information, and any assets the business has.

Now there is a word of caution when selling the email lists. It must be part of the business as the asset. You also have to send out an email to any subscribers notifying them of the change of ownership and give them the opt- out option. Once the new owners take over the internet business they should send out an email introducing themselves, what they hope for the email communications, and provide the opt out once again. At this time the consumer has the right to make sure they do not receive emails making the sale of the list legitimate. Email list sales are a sticky situation, but as part of the business it is an asset.

If there is a brick and mortar business account with the Ecommerce business you can sell the account. This account should be separate from your personal life. In other words the business income should not go into a personal checking account so that your business financials are a separate entity. Most of the sales from online are credit card transactions, which mean you should have merchant account statements and bank statements to share with the potential buyer.

Another important point about the financials is that they should date back two or three years. A new website is harder to sell for a good price because you have not established yourself. It is best to look at selling an Ecommerce business only after it has been two or three years unless you are selling business to business. In other words, unless you are creating the websites for the purpose of selling only and not as an entrepreneurial business, you should not try to sell it in the early years.

Also do not second guess a bad period. Businesses online take time to set up and start making money. Do not sell out because of a few bad months. Instead, try working through it to see if the reward is really there.