For a number of reasons, putting your ecommerce business for sale can be as challenging as building the business itself. Even though the entrepreneur may not have created the business with the objective of selling it, scaling and growing the enterprise can be limited without the resources and professional help. Other than the scarce resources, fierce competition in the e-commerce space can also lead to a decision to put ecommerce business for sale.
When you prepare to put your ecommerce business for sale, you must start by carrying out its valuation, then go on to explore the options of buyers available to you. The valuation of the business determines its saleability. This, in turn, depends on factors such as the financial health, age, brand, and customer service of the business.
1) Finding the right buyer
Entrepreneurs running an e-commerce business have a large number of buyer options to choose from. Selecting the right buyer can be challenging, especially if an entrepreneur does not know exactly what they want from such a sale. Here are some places where you can sell your online business –
- Marketplace: Small businesses the owners of which wish to sell it directly.
- Auction: This allows potential buyers to place their bids on the business and lets the seller reserve the price.
- Brokers: A broker’s services can be availed of if the seller has no prior experience in selling an e-commerce business. They help with valuation, looking for potential buyers, and getting the best price.
- Investment banks: Bigger businesses can sell to investment banks that raise money from capital markets to fund the business.
Listed above are some of the places where one can sell their online business. Here’s a look at the type of buyers for e-commerce businesses-
- Internet entrepreneurs: These are businesses that operate on the internet or competitors who may be looking to expand and acquire additional operations. Ensure that such a buyer has enough experience to be able to grow and scale your business.
- Private equity firms: These firms fund businesses by raising money from high-net-worth individuals. If your business is relatively bigger, this could be a suitable option for you.
- Brick-and-mortar businesses: Physical stores that may be seeking to expand their operations online are another option. Such entrepreneurs may either sell their existing business or simply add to it by acquiring an online business.
- Marketplace aggregators: These are operations that seek profitable e-commerce businesses operating on platforms like Amazon to acquire them. They utilize their availability of professionals and access to resources to grow and scale such small, homegrown businesses. Setting up your ecommerce website for sale is a way that is getting picked up by many businesses, as it is an option that lets you keep the core business ideals true and have a relationship with the company that is actually beneficial to all parties involved.
2) Being on the wrong e-commerce platform
For those running their businesses on e-commerce platforms, it is important to consider factors like the product being sold, budget, customer experience, and plans for scaling the business in the future. If you select the inappropriate e-commerce platform, the growth plans of your business, conversions rates, traffic, and revenue can suffer. At some point, you will have to move operations to a different platform, wasting valuable time, money, and resources.
There are platforms that offer basic features allowing you to display and sell your products. Some platforms, on the other hand, allow customization. Online businesses may also have their own content management systems (CMS). A CMS allows you to freely design the platform and deliver the user and customer experience you aim to achieve. Selecting the right platform from the get-go is important, especially if you plan to put your ecommerce business for sale.
3) Having poor website design and navigation
Having an efficient website design that allows smooth navigation is important for retaining customers and boosting sales. There is no dearth of options for customers, so they may be put off by poor functionality on the website and go somewhere else. A business with an excellent website design will have a robust customer base, and therefore, become more attractive for buyers. A UX professional can help optimize your website and design it in a way that enables more sales.
Businesses must also balance user-friendly content and SEO-rich content, which is important to create organic traffic. Crisp, clear product descriptions and accurate photos and design that are appealing to users and also translate to sales are important.
Should you wish to sell your business, ensure that your website design can be scaled. Ensure that you incorporate additional products, services and features into the website. Engaging a web developer could help avoid the additional costs of scaling the website in the future.
Professionally taken product images, as well as good copywriting, add quality to the product pages on your website. A balanced mix of elements and media including videos, images, customer reviews, and ratings make for good product pages. Businesses that fail to focus on these details appear to have a difficult time finding a buyer.
4) Poor Customer Service
The competition in the market is cutthroat. So, being extremely attentive to the needs of your customers can really pay off. Several activities constitute customer support such as replying to messages received on the website, queries, and comments on social media and providing resolutions over phone calls.
Businesses must invest in this aspect of their operations because it ensures customer retention, and therefore, sales. Offering returns and refunds and promptly solving all queries and grievances makes a business credible and customers return to it time and again.
5) Lack of Strong Brand Message or Identity
Your product may be a groundbreaking, first-of-its-kind invention that resolves several problems, but failing to establish a brand identity will result in poor performance. Such a business may become difficult to exit when the time comes because it fails to convey a strong brand identity. Efficient use of marketing operations helps create such a brand identity which in turn leads to customer acquisition and retention.
Ideally, an entrepreneur should plan their business operations from the get-go, right down to their exit strategy. By doing so, they will be on a better footing to address the challenges thrown up when they put their ecommerce business for sale. A business will find many takers if the entrepreneur has groomed it to be efficient and deliver a steady performance. The challenges faced by entrepreneurs when selling their e-commerce business are the result of decisions taken during the course of a seller’s ownership. There is no shortcut to making a sale on desired terms because tackling these challenges is an ongoing process and cannot be addressed with a band-aid solution.