Undoubtedly, it must have been quite the adventure setting up your Shopify store and nurturing it from infancy to its current status. However, in every entrepreneur’s life there comes a point of reflection when you consider the journey so far and the way forward. The last couple of years have seen a consistent boom in the valuations of several Shopify stores, maybe including yours. If that is the case, then you are well justified to consider putting your Shopify store for sale.
There may be other reasons as well to put your Shopify store for sale, such as newer enterprises, taking time off for self or family, or just plain fatigue. In any case, here is a helpful tutorial to help you sell your Shopify store.
Get Your Shopify Store Valued
It is a common mistake to not differentiate between cost and value. A cost towards a buyer may be an absolute number, but the value of your business is not as simple and objective to define buy furniture online. An overvalued or undervalued business, both, can be potentially detrimental. While an undervalued business can lead to financial loss, an overvalued business may lead to loss of credibility and reputation.
Any potential buyer will want to see your historical performance and account statements. Typically, 12 months of profit and loss data is a helpful guide to arrive at a monthly average. However, the other aspects which will significantly affect the valuation of your Shopify store include:
- Business Age: The older your business is, the more credible it is deemed to be. This is mainly because it is more likely to have seen its share of highs and lows and still managed to sustain performance.
- Products Inventory: Not being dependent on a single product for revenue is a smart way of ensuring safeguarding against unpredictable changes in the supply and demand chain. It is also helpful to reduce overall business risk. It also acts as a determining factor while putting your Shopify store for sale.
- Traffic Diversity: Similarly, a business that is not dependent on a single source/medium to generate sales is a less risky proposition and likely to achieve a higher valuation.
- Brand Recognition: Having a recognised brand, with enough traction on social media and good reviews overall can significantly impact your valuation positively. This also has high appeal to potential buyers.
It is not uncommon to seek expert assistance to get a professional valuation done before putting your Shopify store for sale. Choose what works best for you.
Identify The Right Channel To Sell Your Shopify Store
The common places and ways to put your Shopify store on sale include:
- Private Sale: While it comes with complete freedom to choose whom to sell your store to and what price, it also leaves you exposed to all sorts of people. It may result in a lot of time and individual effort on your part and does not have a very high success rate, typically.
- Marketplaces: Online marketplaces are like the yellow pages or online classified directory where you can put your Shopify store for sale. In such a case you don’t need to rely entirely on personal network connections, but you can still save the cost of commission for availing of professional consulting services.
- Brokers: Getting professional assistance from a brokerage firm may be advisable for small and medium businesses. It saves immense effort and time and also increases the chances of getting a better price from the sale.
- Acquirers: Another channel for selling your Shopify store is via professional companies that are always on the lookout for businesses with the potential to buy. In fact, these companies offer an end-to-end service starting from brand valuation to the actual sale. Some may even choose to integrate your business into their business model and/or platform.
Planning is a very helpful characteristic in any business. And when you decide to put your Shopify store for sale, it becomes even more necessary. Some of the ways to make your business more appealing to potential buyers are:
- Be clear about your reason for selling: Knowing why you wish to sell your business is the foundation of setting the right intangible value and attracting the right buyers. It will also help you prepare better for the sale-related negotiations that are likely to take place.
- Organized Financial Statements: Having neatly organized financial, clear documents regarding inventory, suppliers, and the general supply chain, and maintaining healthy online visibility are just a few of the things which are more likely to catch the attention of potential buyers.
- Have a proper Exit Plan: Not having an exit plan is like shooting in the dark. Your exit plan is a vital part of your negotiation strategy and should include your exit or walk away price and any other contingencies to prepare for. After all, selling your business doesn’t mean throwing away your labor to anyone at any price.
- Chart out a time plan: Set internal goals, targets, and milestones for pre-sale listing activities like updating financial statements, terms of ownership, etc, and post-sale actions like planning for the capital windfall that will come your way.
Putting your Shopify store for sale is a big decision and you should be willing to do all that it takes to get the best deal in this process. While the above-provided information should help you get the most out of this process, for more tips and information, you can check a detailed guide on how to sell Shopify stores online here.