7 Factors to Determine a Website’s Value

By | May 23, 2008

Determining a website’s value is required if you want to get into the business of buying and selling sites for profit. There are various factors used to determine a site’s value. Knowing these factors can be crucial to your success in the venture. Here are some of those factors:

  1. Popularity – you would want a site that has been established, with good traffic flow and an established name. Successful entrepreneurs agree that the best type of site to buy would be one that has a generic domain name. This lets more people stumble onto the site by typing generic urls. Of course, more popular sites also cost more.
  2. Establishment – it is always better to get a site that has been online and has established itself somewhat. This way, your acquisition of a website would also get you access to various contacts who can help you support that website and improve it. Purchasing an established site may also get you a steady flow of profits from established clientèle.
  3. Potential – this is the most important factor that you should look for in a site. Potential is what you think the site could be with your help. Without potential, a site is worth nothing. The business of website flipping is all about bringing out the true potential of a site and profiting from it.
  4. Upgrade costs – You need to take a look at the site and determine just how much work it needs in order to become salable. Try and translate all costs , including manpower and effort into financial terms so you can better understand exactly how much is riding on the site development. Make sure that the site development is cost-effective. After all, it is still a business and you need to get some profit!
  5. Expertise– do you actually have the knowledge required to turn that site around? You need the right skills and understanding of market behavior in order to anticipate what would make a site do well.
  6. Tech – The value of the site revolves around the technology it employs. This usually determines the efficiency of a site to reach target customers or users. The technological value of the site also determines just how much work you have to do in order for the site to become competitive. As you may realize, on the internet, technology always counts.
  7. Comparative cost – not only should you consider the cost of acquiring and revamping a site, but you should compare that cost to building a new site from scratch. If too much of the site needs renovation, then you might want to just forgo the acquisition and build a similar site from scratch.

These are just some of the essential factors you should look at in order to judge a website’s value. Remember that the aim of site flipping is in increasing the site’s value and profiting from its sale. Taking into account all these factors would definitely help you gain a better judgment on where you stand in business.

4 thoughts on “7 Factors to Determine a Website’s Value

  1. Gary

    So does this mean that a brand new turnkey website is worth zero dollars, even if it was 6 months in development?

  2. Rob

    There is another site out there called Web worth – “Web Worth can estimate a web sites worth or value, daily ads revenue, daily page views, back links and directory listing” http://www.webworth.info/ – Try it out looks like the data is based on traffic!

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