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Watch Out For The Smaller Sales – Are They Really Worth Your Time?

February 28, 2012

I heard someone say not long ago that it’s the smaller sales that are often the most trouble, and the most time-consuming.  A recent domain sale of mine echoes this sentiment …

I received an initial inquiry on the domain on February 2nd.  The final sale price and method of transaction were agreed upon within four days, on February 6th.   Finally today, February 27th, after much ado, the domain is safely in the buyer’s account and they have just confirmed receipt with the escrow service.  It’s now a matter of the funds being disbursed, which will likely take several days, but at the rate things are going so far, it may not hit my bank account until sometime next week.

That will be one whole month to close what was essentially a very small deal:  Net ~$275 to be exact (my profit, minus transaction cost and renewal fees over the past 3 years).

I find that whenever a domain related story or news item pops up on one of the bigger tech blogs such as HackerNews, TechCrunch or others, it seems to inspire a long and sometimes heated debate in the comments section between those who invest in domains and those who do not.   The question is usually raised from the general public about why a certain domain is selling for $x amount, and that they wouldn’t have paid, nor do they consider it worth more than $250 (e.g.).

In these cases, I have noticed there is always at least one domain investor to speak up and say something to the effect that, “it’s not even worth my time to sell a domain for less than a couple grand.” (usually preceded by a LOL, or a LMAO).

I admit that I’ve never really quite understood this posture, but I’m starting to.

If I had to break it down in terms of an hourly wage, at $100/hour, this domain sale would simply not have been worth my time.  At $50/hour, it may have been just barely worth my time, considering not only the collective effort I spent in closing and managing the deal, but also time spent managing/marketing the domain over the past three years.

In the future I’m going to take this into more consideration when negotiating smaller deals.

Finally, my recommendation to those buying domains in the sub-$500 range: Try to avoid all the dilly-dallying, or you may find sellers becoming less eager to do business with you..

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