There is no denying that the business of buying and selling websites is growing. There are more and more people getting involved in the industry, and while this is no doubt a good thing, it does mean that the chances of running into someone who is trying to scam you will also be higher.
While the following is a basic list of some due diligence that you can perform yourself when looking into buying a website from Flippa, you can apply the principles to any website marketplace.
1) If a deal seems too good to be true then it almost certainly is!
I’m not saying that you won’t stumble across some genuine good deals out there, but from experience the majority of the deals that are “too good to be true” will generally have something wrong with them when you start doing a little digging.
2) The traffic and revenue don’t add up
When you are looking at the traffic and revenue figures they should follow the same trend, i.e. stable traffic should equal stable revenue, a high traffic month should see an increase in revenue, a low traffic month should see a decrease in revenue, etc. While there are some exceptions for this, (i.e. the seller has experimented with paid traffic one month that doesn’t convert, etc.) the seller should be able to account for these.
3) Seller’s reputation
You should always do a check on your seller’s reputation. If a seller has more than 10% bad feedback then you should definitely leave that deal alone. The problem arises when you have a brand new seller because they won’t have any feedback/reputation. In cases like this you should find out their name, email address, Skype, AIM or whatever you can, and Google them. If the seller is genuine then there should be no problems with them supplying you with this information, if they hesitate or say that they can’t then walk away.
4) Get the real statistics
It is very, very easy to fake Google Analytics stats reports (either screenshots or PDF’s), so a genuine seller should always be able to back up their stats by giving you “read only” access to their GA for the site they are selling. GA is pretty much the standard tool for this and almost any website will be running this (there are still those that aren’t though, but they are in a minority).
If a seller says that they don’t have GA, then you can always check to see if they are lying by going to the URL of the site for sale and using “F12” (or right click and ”View Source”) to view the source code, press CTRL+F and type in “analytics”. If you see a GA tracking code then the seller is hiding something, so walk away.
5) Unprofessional listing and behaviour
What you need to be looking for here is spelling mistakes, poor/bad grammar, and a general unprofessional attitude (i.e. rude, pushy, etc.)While behaving unprofessional does not make someone a scammer, it is a warning sign to watch out for. At the very least it may show someone who doesn’t actually know what they are doing.
Remember that you can walk away from a deal if things don’t add up at any time!