Shownotes
The more I spoke with Mark, the more I realized selling an ecommerce business is really complicated. Consider where you are selling, what you are selling, how long you have been selling. how much you have been selling, your standing on the site, your feedback, your vendors, your gross profit, your net profit and even more. The real question is your ecommerce business worth anything today and even more tomorrow? Seems waiting and getting your house in order is the smart move and Mark’s advice can help you get the most value.
ps.. And YES, I ask the sales tax question.
Mentioned:
Sponsors:
Gaye’s Million Dollar Arbitrage List
Transcript: (note- this is a new tool I am trying out so it is not perfect)
Stephen: [00:00:00] It just want to jump in and mention my sponsors doing them all in the front. So I hope people appreciate that that’s kind of a new thing that’s been going out in the podcast world and this episode is such a great episode. I’m so excited and I really am. Gail is BS. Interview I hope you listen to that number to 38 and it just blew me away because she is the real deal that arbitraged group she’s running is just rocking it. I’m in it and I’m watching just people just knocking it dead. And you know for$149 for you to be able to get in there. There is a free week that she’s giving if you go through my link and I have a link on this episode. But I mean to me that’s how you can build up this Q4 and if you even can’t get it get on the waiting list because she’s going to pull from there when somebody drops for whatever reason.
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Stephen: [00:01:23] Ultimately that’s how you get the buybacks. You got to know what people were searching for. You put that in there you get that adjusted to know exactly what they’re searching for and boom you get found right being found on that page one. How do you do it by knowing the right keywords. How do you do that. Look at your competitors and use their keywords. That’s how you do it. And sculp allows you to do that. It’s just a powerful thing. Solutions for e-commerce. Karen Lochore you’ve heard me talk a lot about her if you haven’t met her. You should. Smart lady who knows what she’s doing. For example today had four items where I forgot what they called it were flagged for quality.
Stephen: [00:02:00] They were quality alerts. That’s what it was and turns out there’s an image issue and she’s like well yeah there’s Amazon’s now making a change it has to be 80 percent blah blah blah blah blah. I’m like I’ve lost interest already. Could you help me. And she’s like fixed. That’s the value of having an account manager. Right. Or when I get those calls Hey I’m calling about case number blah blah blah like that goes to my other person and that just happens to be my team member who happens to be Karen her team solutions for e-commerce dot com slash momentum. Saves you 50 bucks. You’re going to say 50 bucks and she’s going to do an inventory health report for you. To me that’s how you know what inventory’s healthy. Q4 you still can get some inventory out of this recording for free.
Stephen: [00:02:44] You probably want to do it. So jump on and get with her. Tell her I sent you. So it’s solutions for e-commerce dot com slash momentum. Go Daddy is another sponsor. And I love what they’re doing because I’m a domain order. We’ve already acknowledged that I got a problem and I just love the fact that I could save 30 percent finally because I never did so try go daddy dot com slash momentum and get your domain but also by that privacy. Look
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Stephen: [00:04:05] I just think it’s so cool so try grasshopper dot com slash momentum. It’s going to save you 50 bucks and you’re going to be able to all of a sudden become that professional organization you want to become. Man I just appreciate my sponsors. I hope you do too.
Cool guy voice: [00:04:20] We’ll get the e-commerce momentum. Good guys. Well we’ll focus on the people the products and the process of Commerce selling today. Your host Stephen Peters welcome back to the e-commerce momentum podcast. This
Stephen: [00:04:36] is episode [2:43]. Mark Doust you know my mind raced so much talking with Mark because I couldn’t get the questions out fast enough because I immediately went to another scenario and what I think I did wrong in my thinking is I keep thinking worst case scenario thinking of every little detail. And it’s funny you know the more I talked with Mark the more calm I got because it sounds like they’ve seen a lot of things. Mark represents a company actually started a company called Quiet Light brokerage where he took and sold his e-commerce site actually I think it was a content site back then but he sold it and he tells the story how he sold it. He almost sold it for a little bit and waited and then got out. However just about doubled in value and he tells about why. I mean I think that’s so important.
Stephen: [00:05:27] The other thing I did get to ask him but it was all the way at the end. I’m giving you a heads up is the sales tax question it’s a big issue. Probably no big surprise what his answer is but I think it’s important. Let’s get into the podcast.
Stephen: [00:05:40] Welcome back to the e-commerce podcast. Excited about today’s guest. And I think a lot of people are going to be excited to hear what he has to say about possibly selling one of your e-commerce businesses and your web site. Is there value is there a way to sell it or have you been working for nothing and he’s going to explain it to us Mark Doust. Welcome Mark. Hey thanks so much for having me. It’s great to have you here. But I say it the right way and you have a company called Quiet Light brokerage quitely brokerage dot com is the Web site and you specialize you and your team specialize in selling e-commerce or content sites on the Internet. Correct.
Mark: [00:06:25] Yes we do anything that’s online as well as an online business sace content Amazon you so you’ll even sell software. OK. OK. We’ve done some of that. And and even some services but really the bulk of what we do if you breaking down into like a pie chart the most of what we do is going to be e-commerce followed by SAS followed by content that’s going to make up 85 percent of what we do.
Stephen: [00:06:48] Well I’m going to jump to the last part where you mentioned that you actually helped sell some services. What kind of service type of business have you helped sell. Because I assume it’s related to e-commerce or you know online somehow. Yes.
Speaker 7: [00:06:59] I mean it’s got to be online. So we’ve done we’ve worked with people that have the agencies or web design firms. We sold one business that the custom business card printing which was kind of that blend. It was the service but also e-commerce as well.
Stephen: [00:07:16] Right. And who knows if they printed it sells right. I mean I guess you would know that but I mean generally you don’t have to anymore. There are so many brokers out there that broker deals in the old days it was in the print business that was one of the things they did get away from it. Now it seems to have come back where you know lots of stuff is done by third parties. I have a friend who sells labels for example food labels for him because he bought dressing and they don’t even print him anymore. They outsource that. And so for all those years they did they now are just a broker and so they mark it up make a little bit of a vague on it and that’s the way it is. And so I’m assuming there’s quite a few of those kind of businesses out there that outsource a lot of their resources. Correct.
Mark: [00:07:59] Absolutely. I think that’s very much the style of most internet based business. There are some people out there that are only in the process from beginning to end. But one of the appeals of the Internet world is the ability to outsource and to be able to personally within your own circle within your own business keep a fairly light infrastructure as to what you actually have and be able to pull in different parts and you can really get away with that in the airline world and it makes sense to do that in the online world.
Stephen: [00:08:29] Well is two questions. One are you seeing more of that where you know companies are you know especially ones that you sell have fewer and fewer true employees and more contractors. And two does that weaken the position of the company or enhance it. So
Mark: [00:08:43] I’m actually split. If anything I’m actually seeing light nudged not a not a huge push but a slight nudge towards bringing in your own employees and own resources and I think it’s sort of the maturation of the industry. But five six years ago dropship was a big thing. At that now. But most businesses are dropship and then if you dealt with a company that had its own inventory that was kind of a rarity. And now you’re seeing this push towards owning a warehouse space or owning the manufacturing process all the way through because there are certain advantages in that especially from an exiting standpoint and protect against competition not that you can’t do that in other places as well or other business styles as well. But I see no point as to whether or not it weakens this position there is there there’s a double edged sword right.
Mark: [00:09:39] From an exit standpoint if you own the employees of own people but if you have your own employees as opposed to contractors if you have a physical warehouse space these things help make your business more defensible from competition. But at the same time it makes it more difficult to transfer. And so you have to find a buyer who’s willing to take on the actual labor there. So depending on the size that the businesses I would tend to say it strengthens the business a little bit but it comes with something of a cost as well.
Stephen: [00:10:09] It’s not location independent then right if somebody has to shut down a plant or a warehouse and then move it to another state that complicates things especially depending on the size. Right so you’ve got and in my state they had the warning. If you have X number of employees that you’re going to you know terminate in and it just also doesn’t make it very popular when you sell it. Right. Nobody likes to see a company get shut down or all the people let go. Right. And that stuff now a days would be put out into the social media world when the old days. I don’t think anybody ever noticed. So. So let’s go back to why you’re in the e-commerce mostly and the online selling world. You were in college when you started your first web site. What were you doing. Boy I think it was 1998 the first web site that oh my god. 1998 was no Internet then. Al Gore didn’t invent it yet.
Mark: [00:11:05] I don’t know who lodged in court on that. So what is this thing. The first business that I started is outside of college. I got a job with an Internet firm and they provided really well what were you what was your major. My major was business and it’s just unusual though.
Stephen: [00:11:24] You got a job with an Internet firm unless you lived in California. That’s unusual.
Mark: [00:11:28] It really was and I lived in a real college I went to was a small school called Franciscan University of Steubenville Steubenville is this all. Oh yeah sure deal town is famous for one thing. Dean Martin used to live there. He was born in. Is that right. Anyone that you talked about didn’t believe they know what they’re like. Oh Di Martin was raised there. Yeah. That’s where he was in a small Internet firm set up shop there. They had offices in Baltimore Maryland and they set up a shop in Steubenville Ohio. Why. I don’t really know but they were the first C-PAP. Everybody knows the panel. If you’ve ever had a hosting account you’ve probably encountered panel to manage your hosting environment. Well they were on the panel before the panel was spat on. In fact the company that started that modeled off of what we were doing.
Mark: [00:12:15] So I got my first job out of college working for them I was an account manager and dealt with all sorts of different clients. And after two years of working with them I got let go from that position and started what I called being professionally unemployed. I was pretty dejected and thought you know if I can just get like all like that why should I work for another company. Let
Stephen: [00:12:37] me stop you there a second because I want to understand when an account manager does. What skills did you learn from that it was relationship based.
Mark: [00:12:46] OK. So the account manager in my position there I was there to act as the friendly face for the company to the customers or pain ongoing like a liaison and then that way they didn’t have to deal with the coders. Exactly. And I would also be there to remind them when they needed to buy more services and upgrade various things. And so it was a sales position. Got a salary got commission on top of that but it was very much relationship based sales so and was the Internet taking off at that point yet or now. So that was the first dotcom bubble and that was my rude introduction into the world of the Internet.
Stephen: [00:13:26] So that’s why you were let go so that it is not performance based or you know whichever it was clearly you were a you know just a cog in the wheel that just got broken because the car stopped moving.
Mark: [00:13:39] Actually no it was. I got let go after that. So what the way it happened was I moved or got that position and I had just a handful of clients was like three or four clients at the time and we had about a 30 person staff managers and salespeople and we walked in one Monday morning and something was happening and next thing you know of the 30 people that were employed they kept four of us and I was one of the four because I was new and I was cheap. Now my client list went from three or four to 220 clients. Did
Stephen: [00:14:12] they run out of money. I mean was it you know was it OK. So it was funded in the funding ran out.
Speaker 8: [00:14:17] Happens like so many companies that by the time the valuations were you know VCs were just throwing money at these companies but they didn’t have a real revenue plan at all. And so they quickly were running out of money realized we need to cut staff after medically. We’re going to the cheapest guys which are these guys we just hired and oh by the way you just went from three or four clients up to 220. You need to call every one of them and tell all your clients that were doubling their rates their monthly rates and that’s popular. So you’re the popular guy. Yeah. Those are some very interesting phone calls.
Stephen: [00:14:49] How many of them stuck. I mean so out of 220 clients how many of them...