How To Sell Your Shopify Store: A Detailed Guide

Creating a successful Shopify store takes a lot of work. It's incredibly rewarding to see your business grow from nothing.

But sometimes, you might want to move on to something new. Maybe you want to start a different business, spend more time with loved ones, focus on your health, or pursue a hobby. Selling your Shopify store can give you the money you need to do that.

The process can be complicated and take a long time, but it doesn't have to be. And in this guide, I’ll show you the practical steps to sell your Shopify store with the best deal!

Step 1: Asset The Value Of Your Shopify Store

It's easy to get excited about your business and think it's worth a fortune. But many business owners overvalue their companies.

The truth is, the value of your store isn't about how much time or money you've put into it. It's more about how quickly it's growing, how well it's running, and how much profit it's making.

You can conduct a business valuation in three approaches: 

Income-based Approach

Focusing on your store's ability to generate income, this method is the most common. You analyze cash flows to assess the risks and rewards of future investment. There are three methods under this approach: 

• Discounted Cash Flow (DCF): In this method, you estimate your store's future cash flow and adjust it for inflation and risks to calculate its current value. It's suitable for new businesses that aren't profitable yet but show strong potential for high future earnings. 
• Leveraged Buyout Analysis (LBO): This approach looks at flows and uses a discount rate to calculate a store's value. The main goal of an LBO analysis is to estimate the profit a buyer might earn from purchasing your Shopify store. 
• Capitalization of Cash Flow: You assess your store's cash flows, annual returns, and expected value to estimate its future profitability. However, you won't adjust it for future economic changes. Instead, you assume your store's future performance will be similar to its past. So, this method is best for well-established stores with steady profits.  

Market-based Approach

The market-based approach determines your Shopify store's value by comparing it to similar stores in the same industry. To use this method, you examine recent sales and purchases of comparable stores, considering factors like revenue, market share, and profit. 

Then, you make adjustments to account for differences, such as the store's size, location, and market conditions. This method is especially useful for fast-growing stores. 

Asset-based Approach 

The asset-based approach values your store by assessing the worth of its tangible and intangible assets. Tangible assets refer to physical items like inventory and equipment, while intangible assets include intellectual property (IP), software, and licenses. 

Businesses planning to close or liquidate would prefer this method because it helps determine how much investors and owners can recover by selling all assets. You can consider liquidation and book value in this case:

• Liquidation value: You calculate the current market value of your assets if you want to shut the store down and sell everything. 
• Book value: You calculate book value, also known as net asset value, based on the total assets and liabilities listed on your company's balance sheet. 

Step 2: Preparations For Selling Your Store

Once you've determined the value of your Shopify store, the next step is to prepare it for sale. Here is how to get started! 

Clean up your financial records

You need accurate financial records to demonstrate your store's profitability and growth potential. The steps for accessing your financial reports are as follows:

• Click "Analytics" on the left-hand menu of your Shopify admin dashboard, and select "Reports" to access various reports, including financial ones. 
• On the Reports page, use the filter to sort by categories. Choose "Finances" to display all available financial reports, such as expenses, revenue, and profit summaries. 

When you open a financial report, the display data is accurate within approximately one minute of real-time activity. If you suspect changes, refresh the report to update the information. 

Optimize your store's performance

A well-performing store is more attractive to buyers. The following tips will help optimize your store's performance for better sales:

• Review website speed: Test your site's loading time to enhance customer experience. You can minimize image sizes and reduce unnecessary for faster speed.  
• Evaluate SEO performance: Conduct an SEO audit to check keyword rankings, meta description, and alt tags for images. Also, update your content and include user-friendly URLs. 
• Enhance user experience: Your site should be mobile-friendly and responsive across all devices. Remember to add clear call-to-action buttons. 

Secure And Organize Customer And Product Data

Organizing your data properly will make the transition process smoother for new owners. Follow these steps to ensure your data is well-managed: 

• Compile customer data: Collect and organize key customer data to provide insights into customer behaviors. Ensure all data is up-to-date and in compliance with privacy regulations. 
• Organize product data: Review and organize your product data, including product description, inventory, and pricing structures. Your inventory list must be current and reflect accurate stock levels. 
• Secure your data: It would be best to implement security measures to protect sensitive customer and business data. You can use strong passwords and two-factor authentication (2FA) to limit access to confidential data. 
• Address legal considerations: As you transfer data ownership and provide documentation, make sure all agreements comply with data protection laws. 

Step 3: Choose The Right Place To Sell

You can sell your Shopify store independently or outside of the Shopify platform. If you don't have a buyer lined up, list your store for sale on third-party business marketplaces that specialize in brokering ecommerce sales. 

Each marketplace has its own process, which may include extra services like legal support, business valuations, and brokers to complete the sale. They may also charge fees for their services, and Shopify doesn't control them. Here are some marketplaces to consider: 

Flippa

Flippa is a comprehensive marketplace that provides everything you need to sell your Shopify store efficiently and securely. You will love it for: 

• Diverse listings: Flippa features a wide range of digital assets that appeal to various business goals. 
• Verified sellers: Sellers undergo a vetting process to prove their trustworthiness and credibility. 
• Bidding system: Competitive bidding and actions help drive higher sales prices by encouraging offers from interested buyers. 
• Secure transactions: Flippa protects both buyers and sellers by holding funds securely until they complete the transaction. 

Business Exits

Business Exits offers a tailored solution with expertise in business valuations and a network of serious buyers. Here are some of its outstanding features:

• Fast valuations: Within 12 hours, Business Exits provides a confidential review of your financials for an accurate valuation and insights into your expected offers. 
• Extensive buyer network: The platform maintains a list of thousands of motivated buyers. So, you can work with serious prospects. 
• Strategic acquisitions: Business Exits helps you identify strategic buyers to maximize value for both of you. 
• Trusted appraisal resources: With access to industry-leading appraisal tools and reports, this platform provides you with a realistic understanding of your store's worth. 

Acquire.com

Acquire.com is a trustworthy, entrepreneur-focused platform for selling Shopify stores. Why should you choose it?

• Transparent process: What you see is what you get with this platform. It prioritizes honest communication that exceeds expectations. 
• Authentic support: Acquire.com understands the challenges you face and provides the tools and expertise needed to succeed. 
• Entrepreneurial advocacy: Acquire.com champions entrepreneurs. You will receive support through every step of the selling process.

Step 4: Create a Compelling Listing

A well-crafted listing highlights your store's strengths and shows buyers the credibility of the sale. So, what should you do?

• Provide a clear business overview: Demonstrate your store's niche, experience, target audience, and selling points. Potential buyers then understand your business quickly and set the tone for further details. 
• Explain your marketing strategy: Share your marketing approach to reflect how your store attracts customers. Remember to highlight popular channels like social media and email marketing. Also, showcase how your marketing drives sales and growth. 
• Detail the assets your store is selling: Outline physical and digital assets to help buyers understand the full value of the deal and set realistic expectations. 
• Include high-quality visuals: Clear and professional visuals enable buyers to envision your store's potential and give your listing a polished appearance. They can also boost buyer interest and engagement. 

Step 5: Negotiate with Potential Buyers

Buyers want to negotiate because they think the asking price is too high compared to your store's perceived value, especially when they spot areas for improvement. Some buyers negotiate simply to get the best possible deal. In these cases, you need to:

• Prepare for discussions: Be ready to address terms like price and payment plans. Consider preparing answers to buyer concerns and data to back up your claims. 
• Know your limits: Determine your minimum price and stick to it. You may be willing to negotiate a lower upfront payment if the overall deal benefits you. 
• Consider different deal structures: If buyers cannot meet your price outright, explore alternative arrangements. For example, in seller-financed agreements, you accept an upfront lump sum to provide a steady income stream while reducing financial barriers for the buyer. And in earn-out agreements, you offer an agreement where part of the purchase price is contingent on the store's future performance. 
• Communicate openly and professionally: Be transparent about your expectations. Also, highlight how the deal structure benefits both parties and take the time to address any concerns the buyers might have. 

Step 6: Finalize The Sale

At this stage, you will formalize the agreement and ensure all legal matters are in order. 

• Sign the agreement: The purchase agreement is a legally binding document that solidifies the terms of the sale. Both parties must fully understand the terms before signing to avoid disputes later. 
• Detail payment terms: Clearly outline payment terms in the agreement. You also need to specify timelines and methods for payment to guarantee accountability. 
• Include warranties: Add provisions for warranties and representations to protect both parties. For example, you may warrant that all financial information is accurate and up-to-date. 
• Engage legal expertise: It would be best to involve a lawyer experienced in mergers and acquisitions (M&A) to review and finalize the agreement. Their expertise guarantees that all legal terms are clear and compliant with regulations. 

Step 7: Transfer Your Shopify Store Ownership

Transferring ownership of your Shopify store is the final step of the whole transition process. There are several things to do:

• Grant access to the new owner
• Update business contact information
• Update billing information
• Change payout information
• Transfer ownership

Follow these steps to transfer store ownership to the new owner:

• In the Shopify admin, go to "Settings" -> "Users and permissions." Then, click "Transfer ownership" and enter the new store owner's email. 

• Enter your password to authenticate the action.
• Choose "Transfer store ownership" to complete the process. 

Bottom Line

You're now ready to sell your Shopify store! This guide explains your options, but you need to choose what's best for you. Two important things to consider are setting a fair price and finding a buyer who will continue to grow your business. 

No matter how you decide to sell, make sure you're happy with the buyer and their plans for your store. Good luck!

FAQs

How much can I sell my Shopify store for?

The value of your store can reach six figures, but it depends on its earnings. For example, a Shopify store should generate at least $3,500 in net profit every month to get a value in the six-figure range. 

Do I need a broker to sell my Shopify store?

Yes, if you want expert guidance and have a high-value store. A broker helps find buyers, secures a good deal, and ensures a smooth transaction. However, it comes with fees. 

Can I sell my Shopify store if I have no inventory?

Yes, especially if your store operates in dropshipping or digital products. Buyers can value your store's potential for scaling and customer base. 

What factors affect the selling prices of my Shopify store?

The selling price depends on monthly profit, traffic, customer engagement, customer loyalty, and other factors. You can perform a thorough valuation of your store to determine its value. 

How long does it take to sell a Shopify store?

The time varies depending on your store's niche, performance, and asking price. It can take anywhere from a few weeks to several months.

Can I sell a Shopify store with an active subscription?

Yes, but the buyer will need to take over the subscription plan as part of the ownership transfer.

Can I sell my Shopify store if it's not profitable?

Yes, you can still sell your store even if it's not currently profitable. However, its valuation might be lower, and you might need to highlight its potential for growth or other assets.

Do I need a lawyer to sell my Shopify store?

I highly recommend consulting with a lawyer to ensure a legally sound sale and to draft a comprehensive purchase agreement.

What if I have questions or need help with the selling process?

You can reach out to Shopify support for general guidance. However, for specific legal or financial advice, consult with professionals in those fields.