Buying a Website

Couple of Questions

[weller]

I am new(ish) to the industry and have been offered a website business to buy and have a few questions that perhaps someone can help me out with. The website in question has been established a few years and is serving the tourism and hospitality sectors and gets between 55,000 –70,000 unique visitors per month. The site is similar to a directory type listing with income generated through selling advertising to relevant companies on a yearly contract.

My questions are:
Does this type of site ie a directory advertiser led site have a future?
What % advertising renewal rate should I expect to see?
Are there any issues that I should be aware of when buying into a website business?

Any advice will be greatly appreciated.

[mack]

"Does this type of site ie a directory advertiser led site have a future?"

I would say it does. Directories are good for pulling in traffic, they provide content and as a result visitors. The more visitors the more you can make from adverts. It has to be said banners and adverts dont pay as much as they used to, but the directory can be used to get the visitors in the first place. Oce you have the bate to attracs visitors you can add new services such as booking and reservations ect.

"What % advertising renewal rate should I expect to see?"

Not all that pay one year will reniew the following year. It all comes down to what they get from it. If they find it helped their business then they will be fairly likely to reniew the folowing year. It may also come down to a branding issue where companies like to be seen. What you need to do is activly seek new advertisers so you are not relying on renewals.

"Are there any issues that I should be aware of when buying into a website business?"

The first thing I would want to know is why are they selling it. Be sure to get proof od sats, income ect before you buy.

Hope this is of some help.

Mack.

[madcat]

Be sure to get proof od sats, income ect before you buy.

Hey- just wanted to be sure with this...get proof of what?

[ritualcoffee]

I think he/she meant:

get proof of the stats. make sure you get documentation outlining traffic volumes and behavioral metrics.

[Travoli]

>income generated

this, and my prediction of future sales, is what I would base the sale on. Are traffic and income increasing every month thus far for them?