Lightbulb Moment

[Trevorjc]

Ok as anybody who has read my introduction thread will know i'm new to the business of running, buying & selling sites. So when i first was looking at this as a possible 2nd income i was surprised at the amount of people selling newly created sites for not a lot of money on places like flippa and Ebay, some people appeared to have 50+ sites for sale. My first thoughts were how do these people make a living? How can they create enougth sites to sell? Why don't they try and monetise there sites first? It must take a least a day or two researching content and then creating the site all for maybe $20 if their lucky.

But now i think i see why they do it. Its not the site that makes them money its the hosting. For example this site i looked at when i checked on whois the same person had over 500 domains registered (which i know is not unusual) they was advertising the site with hosting fees of $10-12 per month on there server.

So if they can sell 100 sites a year all paying $10 a month that s a $1000 a month + the sale price + their sites are listed with a $15 transfer fee. Its not a lot of money at the start but fast forward 5 years & and it adds up to not a bad income at all.

What do you experienced guys and gals think is this why there is such a large qty of dross for sale?

[Clinton]

Some of the flipping courses have been advising just this.

Small flaw in the plan: Most people buying these turnkey sites discover before long that they wasted their money.

I can't see them still paying for hosting five years from now. Or five months for that matter.

But it is presented as a clever idea in site flipping ebooks and courses because buyers of these products don't have the background to realistically predict this model five years into the future.

I'm surprised Flippa hasn't yet published a blog post explaining this idea in some depth

[benitez17]

There is a large amount of junk available for sale because it is easy to create junk. As Clinton said, one business model recommended by site flipping gurus is to sell a cheap site (or even give one away) to hook a customer who buys hosting, support, site upgrades, and so on from you for life. It's great in theory, but the flaw in the plan is that the junk site is unable to make money in most cases (and the site seller can't help there, because they only know how to make money selling template sites), so the customer gives up on the site and doesn't buy any additional services. On the off chance that the buyer does some work and figures out how to make the site a success, he will quickly figure out that paying $10+ per month for shared hosting for one site isn't that great of a deal, and they move elsewhere, or the site outgrows the shared hosting, and they move elsewhere.

I would suggest that you try pretty much any other business model but this one. Most of the people using this business model are not successful, they just haven't given up yet. The few that are pleased with the results of their efforts either place virtually no value on their time (because they are working for a couple dollars an hour, and would be better off working at McDonald's if they want some extra cash), or they live in a country with a very low cost of living (nothing wrong with that, but I don't want to have to compete with someone who is happy making $25 a day).