New Ecommerce sale

[chrisjp]

Our company which owns and operates a number of online retail ventures has spent 9 months developing a new kitchenware store which has been built to a very high standard and has a reasonable (low 5 figures) initial stock purchased prior to big launch.

Due to another site taking off better than expected we no longer have the resources to begin a similar journey with the latest creation. Whilst there is little sales history, a large amount has been invested to this point and we would be interested to know if anybody has any experience or could guide us in the right direction with a view to selling the new site and stockholding to make an appropriate return on the time and capital invested to date.

[webgeek]

IF you had the time and inclination to move the site forward, would it be profitable?

If the answer is yes, then why don't you outsource the administrivia for a percentage of gross sales, so you only take on a variable cost (win-win arrangement).

If unsure or no, then it sounds like a candidate for Flippa or similar.

Sorry to be vague, but I couldn't tell from your question whether you're looking to franchise it, sell it, or what exactly.

[chrisjp]

If we were to move the business forward, it would certainly be profitable. It has been profitable in the first couple of months though on a very low turnover as it hasn't officially been launched (we usually advertise our companies across print and/or tv to get kicked off).

The problem is that we only have 4 management level staff and nobody has the time to take this business to a level it should or could be. I have considered having one of our key suppliers run the website and we will just keep a small equity stake however there is a chance that the customer experience will deteriorate if this supplier is biased toward their own product on site.

The site/business is possibly more than a sole trader would want to take on and to fully exploit the opportunity there would in our opinion need to have further capital invested to take market share. Another issue with us remaining involved is that it will inevitably still take our time with operational assistance unless the buyer had storage etc as we currently stock and ship from our warehouse. Whilst warehouse staff are no issue to increase, it will still demand management time in a critical period for us.

I have looked at flippa and have a couple of questions. It appears just US based, is it? Also, are the buyer on here just looking for the domain and site construction as if they are we will still have the task off selling our current inventory.

[webgeek]

Unless something has recently changed, they are international, but prices are bound to USD (or were originally).

If you filter by high-end/established, you should see that there are some fairly pricey sites for sale. I've not looked at any auctions there for sites with inventory, as keeping stock was never something I saw as a part of my plans. I did flip through quickly and saw some that had merchandise, though it was of the dropship variety.

If this is a significant venture, perhaps Shield, Henley or Avondale would be a route to consider. Let someone else find the right buyer, for a fee :)

[alanf]

A question? If you think it would be profitable and the only reason you don't develop it further is you only have 4 management level staff, why don't you take on a 5th management level member to the team, low wage high performance bonus?

Without a credible answer to this then getting anything more than the stock cost back would be unlikely - in my opinion.

[Red Eye Media]

A question? If you think it would be profitable and the only reason you don't develop it further is you only have 4 management level staff, why don't you take on a 5th management level member to the team, low wage high performance bonus?

Without a credible answer to this then getting anything more than the stock cost back would be unlikely - in my opinion.

I agree.
If it's going to be profitable, then why not throw more people at it.
If the warehouse isn't big enough, you should consider getting a bigger one.
Surely with good management you could manage both?

[IridiumCorp]

One of our partners was faced with a similar situation. What they did was to head hunt in a guy with a tract record of building up companies from a very initial point. They gave him a percentage of the company with performance related exit stategies. They gave him access to main company resources like accounting, premises etc.

Seems a shame to get this far and not reap the profits from it.