how to buy a shopify store

buying a business is awesome and it's,changed my life and all of my clients,lives but,there's risk involved risks that you,need to know about before you drop your,savings on an online business and,whilst there are many places out there,to buy great websites there's also this,ever popular place called,shopify exchange which is a place that,people,who own shopify websites can go away and,list their own shopify websites,for sale and clearly there's some pros,and cons to this,the pros are that anyone with a shopify,store can,list their business for sale and the,cons are,that anyone with a shopify business or,store,can list their business of sale meaning,people can create a shopify store make,it look like they're making a lot of,money but in fact,they're not and because of this many,people have been taken advantage of,many people have been scammed and you,can see all the reviews and stuff like,that,all over the internet of people being,scammed on marketplaces like this so,in this video i'm going to show you how,to find a decent business on shopify,and not get scammed i'm gonna share my,screen with you and walk you through,basically the whole way,through how to buy an online business,from a shopify exchange and,also if you stay to the end i've got a,free gift for you,one that you can use to prevent yourself,from getting scammed when you're buying,a website business,on a marketplace like this and i,actually think it's a vital resource,that you,are going to need when you buy any,online business whether it's through,shopify exchange,or any website broke or other,marketplaces so,stay around to the end and i'll show you,that now let's go away and check out my,screen i'm going to show you,what to look for and what to look out,for so here we are,on shopify exchange and,as you can see you can browse different,businesses different business types,okay and different locations and all,that sort of stuff but what i've just,done is i'm just in pretty broad,and you can see here that you have,private listings a lot of these are,private listings,okay the reason people make these,private listings is because they want to,keep their,url or their domain name private,reason being is because they don't want,other people coming onto this website,and seeing that they have a successful,website and then go away,and copy what they've done and become a,competitor,so what's important for them is to make,this a private listing and if you want,to actually go away and get access to,look at this,business of sale is you click on view,listing you can get in contact with the,seller of this business sitting and you,can sign what we call an nda,which is the non-disclosure agreement,which,shows to the seller that you're not,going to disclose,any of the information that you use and,you're not going to compete as well if,you sign an,nca which is a non-competitive game,agreement that you're not going to,compete with,this business so it's really important,for people to protect the business that,they're selling in case,they don't sell it or to protect the,person that does become the new owner of,the business so they don't have,a bunch of copycats out there competing,with the business they've just bought,so i think it's a very very fair thing,and normally the businesses that are,private listings are going to be the,more genuine businesses that are for,sale and i say,normally but and main reason is because,people that are just trying to sell a,business that,create too many barriers if they're just,selling some cheap,flabby business that's not really,getting any,sales so let's go through and we won't,be able to use these listings because we,won't be able to look at the url and,much information,but let's look at two businesses the,first one i want to look at is,cheaper loop okay so let's look at,cheaplu and,let me show you what i think about this,business and we'll,come to a sort of conclusion on why this,business is either good or bad,so here we go i look at the business,price okay so they want fifteen thousand,dollars for the business,and it's making 53 000 in revenue per,month,average sessions okay that's cool but,what i look at this is the average,revenue and then i look at the average,profit,and they make about an average net,profit of fifteen thousand dollars,eight hundred per month and my question,my alarm bell or red flag is that,if they make 15 000 800 per month,why they selling it for less than a,month's profit it mustn't be a very,valuable business if that's the case,and so sometimes you can have people,here on shopify exchange,having these numbers look really really,good and they're just,trying to sell something that's not very,valuable so that's a that's a red flag,for me an alarm that i need to be,looking into,so what you i suggest you do is you go,away and get access to,viewers access to the shopify account to,verify these figures,also you want to be checking their ad,account to verify how much they're,spending on,advertising because the difference is,and this may be stock but,i dares are they spending a lot of money,on ad ads so,we scroll through and they say it's a,drop shipping business,and the reason for selling they can just,make that up what's involved in run the,business,this is a real business hard work and,discipline i'm most important,okay i don't know if it is a real,business,you don't need to explain that so that's,another funny thing that i find,and then i read here you have to create,ads and manage them on facebook,ads each and every day find new,marketing angles create new creatives,you can create new content every day,and then you know to refresh what,potential customers see,you will have to fulfill the orders and,so these are from aliexpress okay,aliexpress is a drop shipper,from china and normally the products,from,aliexpress are not very good quality so,even if this business was legit i'd be,questioning it,because i wouldn't want to buy a,business that was selling,you know non-quality products and also,aliexpress takes a long time to ship,from you know say if you're selling in,the us,which i dare say this business probably,is or even to australia or any other,country it can take a long time to ship,from china to the your home country or,where the purchases are,so that can create a lot of headaches,with customer service,so 35 profit margin on those they're,making about,you know 1300 on sales okay,so if they're making 1300 sales what i'd,like to do is like,if their revenue is 53 000 right so i'm,going to do this,on my little calculator here,if i do 53 611,divided by 1300 that means they're,making about 41 dollars per sale so let,me go away and look at their,their actual business here okay so they,got two only two products,they're selling this and and it's gonna,have to be in english this is a,french site so i dare say it takes a,long time to send these,from china to france and it's,30 i think it's 30 pounds so that could,end up being an average order of,say 40 so that could make sense i guess,but what i'd be doing really is,i'd be really questioning why they're,going to try and sell this business for,you know one month's net profit then i,like to scroll down,and look at some more information you,can see that there was nothing this,business was nothing until it hit,november,and then they just built it up over the,over the december and january period and,you can see it's not really going very,far,i'd be wanting to look at more,up-to-date financials for this as well,and they're spending fifteen thousand,dollars on facebook ads,so that's crazy isn't it they're,spending fifteen thousand dollars on,facebook ads so the risk is if you,buy this business you've got fifteen,thousand,two hundred and thirty almost 240,dollars,per month to spend just to be making,the uh fifteen thousand dollars no so,i'd be there i'd be considering this and,what i suggest you do is go away and,look at the health of the email list as,well,okay so they're going to tell you that,it has the funny thing with these things,is they say they got huge potential,potential unlimited you know scalability,and things like that these are buzzwords,and what it does is it creates an,emotional trigger that people like oh,wow this has massive potential and,people buy into that,what people do when they come to buy a,business is they try to,work out they try to work out how good,the business is and see if it's a good,opportunity and i think that's the worst,thing to do,because what happens is they try to,prove the business is a good investment,instead we should try to prove the,business as a bad investment and if we,can't,then we must buy so this one i just walk,away from,so let's go back to the drawing board,okay so we'll close out all that,and then we will go to back to the,drawing board,and just keep scrolling keep scrolling,so more private listings,sell you there's a winning product,cellulite simple business to manage,potential to become a sick seven-figure,business in the next few months,see that's another buzz that's,ridiculous right,so they're asking for thirty thousand,dollars and they're making eleven,thousand,almost twelve thousand dollars per month,so within two and a half months,you're going to have the business paid,off 100 and making more money,but i really don't i i'm really not,confident that's a good business,okay so those buzzwords and this not,making sense is,i just stay well away from that unless,you really know how to do due diligence,and you want to sort of burn a bit of,time on,wasting your time doing dude on some,listings like that here we go we've got,another one here,twenty thousand dollar asking price and,then making twenty thousand dollars a,month net profit,over 180 000 in revenue limitless,potential,as it's a pro problem solving evergreen,kitchen brand so that's,a funny one as well limitless potential,see these are these are buzzwords that,are trying to get people to buy,their business without any real proof,that it's a good business,so we'll keep scrolling keep scrolling,here we go we've got something,we've got two different businesses here,we've got one here that is three hundred,thousand dollars,okay and they're making an average,monthly net profit of ten thousand,dollars,which makes more sense because,businesses on average are selling for,this is about 30 months of net profit,okay so that makes sense,and that's what e-commerce businesses,sell for and then this one here as well,this is,250 000 and they're making about,thousand dollars net profit as well,so you've got about 25 months until this,business is completely paid off let's,see if they're using any buzzwords or,anything like that,no face masks okay so pretty standard,customer right they have a returning,customer i have 10,and and reviews okay cool let's check,this out so we go to misfits,and i've already checked this out,quickly so like okay so they've got,some inventory here as well i like the,this all right something that i look at,straight away,and then it's realistic about 10 hours,per week to run,tells us what they need to do i won't go,through this whole listing,but what i saw here that i like is that,the av,they're just being completely,transparent that they also,sell and make a little bit of money on,etsy and ebay and,amazon okay so what i should be,suggesting is looking at their figures,not just in shopify but looking at their,profit loss statement and getting proof,of finances,and as you can see it's not just like,boom crazy business is built up,overnight this took a little bit of time,it did come,quick but you know september to feb you,know there's six months,and it looks like it's continuing to,scale so i'd still be wanting to look at,march,so they're also spending a lot of money,on facebook and google ads,okay and they're making what 10 000 a,month yeah so,they're spending a lot of money to make,not much money but that's something you,can go away and look at now they've got,12 000 email subscribers and 500 this,means nothing,but this is good because if they're,engaged that's great so let's look at,the,legitimacy of this business you can tell,that this is in a,in a quite a good niche but they've also,got an email,straight up that's great i don't,know about this i don't believe this i'd,be getting proof,before you purchase the business that,they're actually uh,in these at all and then also,i'd be checking checking this out the,752 reviews,within a short period of time that's,that's crazy,it looks good but you just want to be,checking that out,so really doing due diligence on these,businesses is important but this,business certainly looks a lot better,than the other business they have a,thing here which is aov,average order value a lot of people,don't know what aov is,and i think it's great that they're just,talking about this sort of stuff because,it shows that they know what they're,doing some of these people that start,these little websites,pretend to know what they're doing and,they got no idea which is why they're,trying to flog a business that,is actually not producing a great return,so,i think this misfit mask one is,definitely better than,the the other one which was a leather,one so let's keep looking,for something legit so coffee we can,come back to this one,here's a business that kind of makes,sense fifteen thousand dollars and five,hundred seven dollars average monthly,net profit,it seems like what they've done and,highlighted here actually makes sense,it's a simple business,found supplies on aliexpress and used,oberlo on the site to generate uh income,so let's look at this site it's kin,gemstone,and this makes sense the average so,it would take about 25 to 30 months to,get your return,on investment back it takes about 12,hours a week to run but basically what,they're doing is they've just got oberlo,running,and facebook ads so,it goes through here and tells you about,the profit margin which is quite cool it,seems like this business has been around,for a while uh which is what i like it's,it's a bit more established even though,it hasn't been going crazy,but you can see over the christmas and,new year period it's done,quite well because they're probably up,the ads here,so i like the look at this business and,they've got,a decent email list and i'd be checking,out what's,you know if they're marketing their,email list and what their,open rate is but this is something that,i'd be looking further into,another thing to check is you know these,things that they show these screenshots,you just want to get a viewers access of,the,their merchant account to show that like,that's actually,legitimate and get proof of funds and,all that sort of stuff so,so there you go guys that's what i'd be,looking at when,looking to buy a website on exchange,marketplace that,correlation between how much the,business is being sold for and then how,money uh how much they're making the,average monthly net profit,and then make sure you reach out to the,seller make sure you verify everything,and,you can see that as you scroll through,there's a lot of dud listings and,there's a lot of buzzwords and a lot of,people just trying to sell you,a cheap crummy website that they've put,together that's not really doing,very well and they're just trying to,offload it and also trying to make money,by selling it to,people that don't actually know what,they're doing and you can see there's a,lot of people being scammed by,looking at these types of website,businesses so i suggest you,understand how to do website due,diligence and i did mention before i,wanted to give you a free gift,the free gift i have for you is my due,diligence framework i've used this to,buy multiple website businesses and i've,all my clients use this and we've all,bought great business making,a couple of thousands of dollars or tens,of thousands of dollars hundreds of,thousands of dollars a month so,if you want to know my exact process go,away and grab this students framework it,asks you the questions you need to get,answers to,about the business to ensure that you,can make an educated,decision if the business is a good,investment or not so go away get that,it's in the link in the description,uh it's called my due diligence,framework youtube watcher what's up it's,jared krause here firstly i want to say,thank you so much for watching and i,hope you're doing,super good i also want to ask you please,subscribe because,my commitment and exploration on youtube,is about to explode,stories polls more amazing content and,more engagement,more surprises and more delight this is,the time,to subscribe and i just hope you,consider it and i hope to see you soon,bye hey youtube watcher if you thought,that video is good you should check out,this video here on the two best types of,websites beginners should buy,or check out my playlist on how i made,my first 100k,from buying websites and how to do due,diligence,check it out it's an awesome playlist,you'll enjoy it

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