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Ecommerce Forum

How to estimate value of online business?

 4:00 pm on Oct 19, 2011 (gmt 0)

I need to roughly estimate value of our business. Can you please suggest what formula/algorithm would be the best to use? Thank you.



 4:18 pm on Oct 19, 2011 (gmt 0)

Probably something to do with income/revenue/profit. Some multiple like 6 months to 2 years.

But depending on the market, the reality will vary wildly and will depend much more on factors like how much of the market you own, and the willingness of potential buyers to pay. So use a formula, but if you're selling, don't trust it as being a true value.


 4:24 pm on Oct 19, 2011 (gmt 0)

6 mths was the last figure i saw quoted and about right


 6:03 pm on Oct 19, 2011 (gmt 0)

I would add that if your business is an online business, then you would need to provide
- PageRank
-Alexa Rank

But also conversion rates of your store.
(How many of your visitors will actually buy something on your site)

I would call these CSF(Critical Success Factors).
They are useful to provide if you want to sell your store


 6:07 pm on Oct 19, 2011 (gmt 0)

- PageRank
-Alexa Rank

Neither of which is worth a *$%# in real terms for evaluation purposes..

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