purchasing online business PLEASE HELP

[newbiehelp]

Hello guys im a new im looking into investing in an online business iv ran a few succesfull businesses but this would be my first online venture im not a computer techie so itl all be a learning curve i have found a e-commerce website for sale which im really intrested in my question is for certain different products it ranks in the top 5 organic search ranking in google which i personally think where the business obviously generates much of its turnover and it would be diabolical if google changes the algorithm.

how often do google change algorithm?
how long and how much money would i have to reinvest to seo and marketers to rank in top 5 on google? as i would have to outsource

its an established website running over 5 yrs
40000 customer database
turnover around £750,000

im paying quite alot of money for the business everything is fine this is my only worry any help would be appreciated.

[sirearl]

Sorry can't answer any of your questions without specifics.

Earl

[Peter Bowen]

How much risk do you like?

Would you buy a 500 seater restaurant in one of the world's finest dining areas as your first venture into the food industry or would you feel more comfortable starting out with a chippie?

[AndyP]

Hi

As the others have said, you really do need to give some speciifics to obtain any useful information or advice. However, generally speaking, Google can (and do) change their algorithms on a regular basis and they don't annouce it beforehand :)

Frankly SEO is an ongoing expense, its work in progress, so to speak. How much? Well, how long is a piece of string? You can spend as much or as little as you want. The spend does not in itself guarantee results, its more about finding the expertise as there are a lot of somewhat shady SEO specialists out there.

Your database and turnover in isolation is of no use really as it does not relate to a specific market so there is no comparison and a t/o of 750K means nothing if the overheads and margins are not known.

Paying quite a lot also doesn't really mean anything.... a million pounds is a lot to most people but spare change to a billionaire...its all relative.

[sirearl]

Frankly SEO is an ongoing expense, its work in progress, so to speak. How much? Well, how long is a piece of string? You can spend as much or as little as you want. .

.

This is not always so.

depends on your market place and how strong your site is in its sector.

We have sites that have not been touched in years,apart from product updates.

Earl

[newbiehelp]

hello guys thank you for your thoughts was a bit vary posting specifics

health supplement retailer
750k turnover
gp 20% after carriage costs
advertising costs 20k
average order £50
all orders dispached by distribution company
200k purchase price

if iv forgotten anything just ask hope this helps

[AndyP]

"We have sites that have not been touched in years,apart from product updates."

Hmmmm... sorry but that does not justify not continung ti perform SEO. I don't understand your logic. The mere fact that you "haven't" doesn't mean that you "shouldn't"

[newbiehelp]

does anyone on this forum help.................

[LBtrading]

I would advise on employing someone to run the site if you decide to purchase the business,

I would advise against buying without any experience but here are some things you need to find out just incase,

-Unique visitors per month thats unique visits not Hits!
- Out of those unique visitors how many are organic ( come from search engines and people typing in the website address etc)
- The point above then needs to be segmented into what keywords(phrases) are bringing the traffic and also what other sites are reffering traffic.

Then you need to find out how much traffic is from paid advertising and hat type of paid advertising is being done, you will want specific stats like like return on investment so if paid advertising on google is being done then is there any tracking being done to see if the paid advertising is profitable.

this really is just some basics,
if it is mainly paid advertising bringing the traffic and its mainly ppc like google etc then unless you know what you are doing then that website can quickly go from profitable to pooring your money down the drain.

even the free traffic from search engine rankings can disappear but this depends on the key phrase and competition.

Like I said there is a lot more to it and it would be a big risk,

hope this helps

[LightingGiants]

Hello Newbie

I would agree with the comments above in relation to you starting you new e-commerce venture. My concerns are if you are new to this area then be weary. going in full on may lead you to fall flat on your face. how well do you know your market???

I am in the process of launching a e -commerce site within the next week or so and would be more than happy to help you with any queries you may have just pm me...even whilst going through the development phases I have learnt alot

Like any business e-commerce requires ongoing development in order to stay ahead of the game and maximise profits

I look forward to your pm

Regards

LG

[allsquare]

gp 20% after carriage costs

I'd be concerned how long it's going to take to pay back the £200k investment?

[MH1]

Sounds like a minimum 3-5 year payback term, but another factor to consider is potential growth, where you might take the company and improve on it's performance, and at what cost.

I'm not an expert but the buying price sounds on the high side to myself, things change so quickly these days particularly on the web.

Best of luck whatever you decide, employing someone to look after your site would be an absolute must though, which would increase the payback period again.

[JTSystems]

I'd be concerned how long it's going to take to pay back the £200k investment?

750k with 20% GP

That's 150k per annun, so 2 years if nothing is spent on development and no wage taken from the business.

IMO that business is selling for too cheap and would be weary.

If the current owner is taking home 150k after all costs then why in there right mind would they sell it for that when they could employ some one for half that to take the burden on their shoulders.

I would imagine something isn't quiet right in the business they are offering you for that kinda money

[allsquare]

If the current owner is taking home 150k after all costs

My mistake, I thought GP was before any costs.

[gibby]

Hi

it sounds interesting but does seem a little overpriced as the profit is a little low.
I would need to know more but I may be able to help.
Were working in a similar sector online & normal retail.

Its a lot of investment so you need to make sure the figures add up & that the current owners will give you enough time to get to know the business & that you can handle the pick n pack system quickly.

Also I imagine from the contacts we have that you may be able to get the product prices down a bit on that sort of volume.

If you want please feel free to PM me and I can look at it for you or hook you up with some contacts already in this market

Cheers

G

[Place of design]

The figures feel all wrong to me

40000 on a database -is that 40000 real customers?

750000/40000 = £18.75 per customer on database

750000/50 (AOV)= 15000 sales a year - that is a LOT of sales from 1 website

assuming no customers ever re-order, the database repersents 2.6 years worth of customers. If customers do re-order, then the bulk of the data base is very old

Get the accounts and webstats properly audited before considering it any further

sounds too good to be true - a lot too good to be true

[PrettyPaws]

We have sites that have not been touched in years,apart from product updates.

Earl

Adding content is part of SEO Earl :rolleyes:

[davidshaw89]

hello guys thank you for your thoughts was a bit vary posting specifics

health supplement retailer
750k turnover
gp 20% after carriage costs
advertising costs 20k
average order £50
all orders dispached by distribution company
200k purchase price

if iv forgotten anything just ask hope this helps

I think this is a very very competitive market at the moment. I wouldn't be jumping into it unless you have sound knowledge of the market, and also some sort of business experience behind you - especially since you will be starting half way up the food chain rather than at the bottom.

[Place of design]

Adding content is part of SEO Earl :rolleyes: It is? Surley having a site with great content first is much better.

[benjamin_c]

what is the company called? might be worth getting the companies house reports, asuming it's LTD

[amanda54321]

i think your products and price is another important factor.
If the price is too high, and the quality is low,even if you pay a lot money in publicize, the visitor and clients will not buy.

we are a durable bathroom manufactory.

[Susan Young]

I think you can make your website advertised on many kinds of other website ,it will be very good for you to expose your website to the public if you login to the forum often .