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  1. #1
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    I'm a longtime graphic designer and a recent (just past couple of years) web designer who created a hobby site a few months ago called Titans12thMan.com. It is an e-zine for Tennessee Titans fans that I did for a number of reasons - one being that I love the team and the other being it allowed me to try out some different things to further develop my skills as a web designer.

    What has happened since it's launch 4 months ago is it has steadily increased in traffic. With limited promotion, I get around 100 hits a day which is not massive but a continuous improvment.

    Onto my question: a company has contacted me to purchase the concept and design of my site. They have their own domain name and do not want mine. They are also interested in using me to maintain the site.

    I know selling domain names is common. But what of a site's concept and design? My goal is to go to him with one price for the sale of the site itself and another for the ongoing maintenace of the site. The ongoing part I can figure out based on the hours I currently spend working on the site X an hourly rate. The "selling price" is the one I am having a hard time coming to terms with.

    Anyone have any advice as to selling a site concept? How about an hourly rate for the ongoing production of the site?

    Thanks for any help.

  2. #2
    Serial Publisher silver trophy aspen's Avatar
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    Your background in graphic design has served you well.

    For the complete site you need to take a couple things into account.

    1. The time it took you to make it * How much you want to get paid per hour. Took ya 20 hours? You want $60 an hour. $1200.

    2. Its value as a future money making tool. I'm assuming you're not going to be keeping your site live after this. If you are well its a different story. I guess if they're a bunch of packers fans who want to make a similar site for the Packers then they wouldn't be cutting in on your potential profit.
    So, if the deal includes the demise of your current site (or the redirection of your current sites traffic to your new site) Then you need to charge them for the loss of money making potential from your site, and for the traffic your site has already established.

    3. The most important factor. How much will they pay? If they're a business, company, corporation etc charge them what they can pay. 5-10 grand. Your site is well designed and you deserve a sizeable sum from it. Especially if the buying is going to be making a decent amount of profit from the site.
    But if its just a few people who want it has a hobby and may not make much money off it then you wont be able to charge them much.

    Chris

  3. #3
    SitePoint Wizard creole's Avatar
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    12th Man...are you a fellow Nashvillian? I can almost see the stadium from where I live. It's like 5 minuts from my house.
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  4. #4
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    Thanks guys for the reply. Yeah, Creole, I am Nashvillian. Basically, I was raised in Hermitage and just recently moved to Franklin. Love it here.

    Chris, thanks for your advice. So far, I've sort of followed your guide. I've roughly figured out how many hours it took to produce the site. I will no longer have my site once it is gone and my traffic will be routed to him. Any loss of money though is minimal since I am in the infancy of ad sales though I do think the site is marketable and could eventually be something I would make money with.

    The value of the site is the tough one here for me. It is a perfect match for this company. I think the upside is unlimited if he puts some effort and money into it.

    I've figured the value at $15,000. I would settle for less. Other conditions are that I continue to maintain control of the site for at least 1 year. I would also be compensated for my work at an hourly rate of $75 per hour. I realize this might scare him off as the total bill for such a project will go over $50,000 a year. This does not include the expense involved in expanding the site as he will need to do.

    I fear I will price myself out of a deal but don't want to give away something I love to do. I may suggest some sort of commission-based payment for product he sells for reducing my hourly rate. That shows I am in this to make him money too. I could also go cheaper on the sale but require more at the end of the year or he is to give back the site's concept to me for free. He'd be renting the site.

    Thanks again and I'd welcome any feedback you might want to share.

  5. #5
    SitePoint Zealot RogueOnTheNet's Avatar
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    Hello there,

    Sounds like you have a great opportunity in front of you. I thought I'd take a swat at this one, and offer my two cents worth, with some of my background in sales/consulting.

    The advice offered you so far is sound...all good things to consider in determining a price. Here are some other factors to consider:

    What do you know of the interested party? Research as much as possible, to learn what sort of financial backing, marketing capabilities, intents, and as much of the overall business plan intended for your concept and design.

    You mentioned this was a hobby site, but perhaps might be taking on a life of its own. Is this a site you would want to develope, market, and dedicate yourself to? Hold this thought for further down in this posting...

    Consider that while you might want to maintain the site, you might also be in the unenviable position of having to "destroy" your creation as you see it, under the new owner...so be careful with contractual obligations that might turn to sour grapes down the road.

    If it's the concept and design they want, and they don't want your domain name, find out what sort of contractual obligation there would be in the way of any non-competition agreements. DO NOT ignore this! This should have an impact of the overall value of this site.

    The reason I say this, is that if you have no restrictions put upon you, get to keep the domain which has established traffic...I would qhip together another website, perhaps change my focus a bit (so the concept is changed), and have it ready to upload the minute you complete the sale. You lose no traffic, and can still develope your website as you see fit under a new look (can even market this as "new and improved!") with a new focus.

    Ask if you can do this, and hint slyly that you might in fact do just that, while casually asking about any non-competition clauses. Perhaps all they want is the concept...but if they want to wrap up customers within the demographic they think your site caters too (and that's probably why they want your concept after all...) then the threat of continued competition makes them more likely to be willing to pay more.

    Now, the best defense is a good offense. Were I poised at the point you are, I would spend a little to make a lot. Today...I'd head down to the Tennessean office (I used to live just north of Nashville...Clarksville/Ft. Campbell area) and spend the money to take out a killer ad in the newspaper, and be ready to run it again. Drum up traffic, immediately and visibly...it will only increase your site's value...and if you decide not to sell, well...there's not much left of the season and you ought to do it to increase your site popularity in any case to take advantage of the season!

    You could draw up quick plans, get pricing etc., on what it would cost to run ads in the papers in Memphis, Chattanooga, Knoxville...just to have the numbers. Call it a planned marketing campaign. You could recoup whatever the projected cost is in the sale, figuring that into the value if you've "already begun it" with your Nashville ads. You now have the cost of a marketing campaign that took time to create and plan...wink, wink. If you planned to continue using that domain under a new design, this would be the marketing equivalent of stealing the goose that lays the golden egg from the slumbering Giant, and getting away with it.

    Go to the interested party with four proposals. And have two prices in mind for each - what you will ask (10-15% above what you would settle for, and what you will settle for) to give yourself room for negotiation. That gives you a lot of room to work with, presents the buyer with as many options as possible, and may get that sale when only one set-in-stone proposal gets rejected. Basically, it's like having eight proposals...

    1. The concept and design. (you can still compete)
    2. Concept, design, domain. (i.e. no competition)
    3. Concept, design, and your services.
    4. Concept, design, domain, and your services.

    I'd give the domain a flat value to figure into the mix. $1000 minimum. If it's outrageous...so what...you said they don't want it anyway. But once you ask them about whether or not you will need to sign a non-competition clause (which you should boldly point out means you'll need that higher price or to refigure your concept/design value with this in mind, as you were thinking you'd be able to continue with your site in a new form with a new design), they may be quickly decide they need that domain too.

    If your goal is really to design sites, as opposed to maintaining one, make sure your asking price is one you'll be happy to walk away with. Also, get hours you would be working in writing, especially if you're going to be asking $75 an hour. Consider what you'll be actually doing.

    With a glut of developers and designers out there, it's not hard to find people who'll do updates/basic HTML coding for $15-$20 an hour. And, if the buyer is planning on spending a lot to market the new concept and design, make sure you have a clear idea where things are intended to head.

    That $75 an hour might come back to bite you in the butt, conversely, if his hired marketing guns tell you to implement a database which you might could be charging $150 or more an hour to do...which you've agreed to do for $75.

    Worse, you might not be able to implement or program something they need or want, and it has the nasty effect of voiding your contract. Ask what sort of other developers/IT personnel might be brought into play. Leave nothing to chance or "good faith."

    Think battle here. You're about to go into battle; in this case, forewarned and set in ink means armed and ready. Still...dont get unrealistic and scare off sale you might want to make by wanting too much. That's why that background information/plans of your buyer are so important.

    Just for thought, a copy of the Tennessean with your site's ad in it lying about visibly might make the buyer desperate, and desperate people will go to great lengths to become...not desperate, heh heh.

    Hope something I've written might be of help or offer something to think on.

    Sean

  6. #6
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    Sean,

    Thanks afor your comments.

    I also have a thread on this topic in the promotions and marketing area. You might be interested in taking a look because it's very interesting.

    Just to update you, I did send him a proposal. It was broken down into two parts. The first was for the concept, design and domain and the second was my services.

    The only reply I got from him on it was on my answering machine which said I had really not understood what he wanted in a deal.

    My followup was to ask him to put something in writing to me so that I could clearly understand his needs.

    So it looks like a longshot at best for now. Thanks again.



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