How to Determine What Your eCommerce Store is Worth
To plan for the future or to sell your eCommerce store, you need to know its value.
There are two common methods – the discounted cash flow approach, or the earnings multiplier (value = earnings × multiplier).
You can also use OpenStore’s free tool to calculate your eCommerce business’s value.
How Do I Calculate What My eCommerce Business is Worth?
Your store’s worth depends on the valuation method you want to use: income-based or market-based.
Method 1: Discounted Cash Flow (DCF)
This income-based valuation method helps estimate the current value of a business based on its anticipated future cash flows using a discount rate.
Method 2: The Earnings Multiplier
The most common valuation method used to value e-commerce businesses is:
Value = Earnings * Multiplier. The earning multiplier can range anywhere between 1× to 3× for an e-commerce store.
To learn more, read the full blog post here.
Where Can You Sell Your eCommerce Store?
There are several ways that you can sell your eCommerce store, but these four options seem to work best.
1. Find a Buyer Directly
You can sell your store to somebody you know — a personal connection, a friend of a friend, or an individual who buys eCommerce businesses.
2. Sell to a Business Broker
Selling your store through a broker comes with broker fees and legal fees, sometimes around 10-15%. The high costs, the months it may take to close the deal, and the fact that they might not always be an expert in your field are a few of the many disadvantages of selling via a broker.
3. Sell to OpenStore
If you want to sell your business quickly, at a fair price, and without paying hefty fees, OpenStore can help. Our team of experts will ensure that you get the best price for your store. If you’re ready, connect your Shopify store and you can get an offer as soon as tomorrow.
4. Let OpenStore Run Your Store
If you’re not quite ready to sell your store, check out OpenStore Drive, a managed service where you can turn your store into passive income.