discuss What is your definition of a wholesale price?

[MrMDMF]

Everyone seems to have a different definition of this term, leading to confusion, especially for new domainers like myself.

Simple question: How do you quantify a wholesale price, and what ranges do you include?

I only ask this as everyone's definition of success is widely different. Someone may sell 20 domains yearly at a 'wholesale' price. This may or may not even register on the fabled 1-2% sale-through rate, but that is a form of success, depending on their definition. On the flip side, one person may sell one domain in 3 years, but that domain goes for 5-6 figures, again, successful, depending on your situation and definition of success.

I'd love to know what you all think
-M

 

[johnn]

Wholesale price = Low Ball

 

[Kyle Tully]

Wholesale = price to another investor who can onsell for ~10x+

Retail = price to end user.

The actual number varies greatly based on the name, niche, market conditions etc.

Success for me comes down to whether you can build a sustainable business that makes well in excess of what you’d make trading those hours for dollars or investing using other strategies.

 

[pb]

For high value domains such as LLL, LLLL, it will be a price at which the domain is liquid.
For other (most) domains it will be 1-10% of the perceived market value, personally I'd say closer to 1%.
GD closeouts are a good example of wholesale prices; auctions not so much, because lots get snatched up by end users.

 

[Daniel Owens]

I usually think of wholesale as low-xxx even for 4L .coms. Then two worders for like $50 per seem wholesale to me.

 

[MrMDMF]

For other (most) domains it will be 1-10% of the perceived market value, personally I'd say closer to 1%.

Market value according to who? End-users? Resellers? Appraisal tools?

 

[pb]

Market value according to who? End-users? Resellers? Appraisal tools?

According to who's perceiving. If you're trying to sell, then it's you, if I'm trying to buy, then it's me. For example I see a domain at an auction that I think might be worth $5k to and end user, so I'd be willing to bid $50, $100, maybe $200 if it's really good. Or you want to liquidate a domain that you think might be worth $5k to an end user but you need cash or are tired of waiting, so you put it up for sale at namepros for $100 or start an auction from $50 etc. That's a wholesale price in my book.

 

[bmugford]

It depends on the type of domain.

"Wholesale" value on a LLL or CVCV is a lot different than some random two word combo that is easy to find and has low liquid value.

Brad

 

[Future Sensors]

Everyone seems to have a different definition of this term, leading to confusion.

So true. Adding to the discussion, for the wholesale section on Atom, they say this:

"Set a price for wholesale buyers. Typically this price is 40% or below of retail price."

 

[MrMDMF]

.

 

[johnn]

Look at this section and you will have a better understanding what wholesale price is:

https://www.namepros.com/forums/domain-buyer-requests.10/

 

[MrMDMF]

It depends on the type of domain.

"Wholesale" value on a LLL or CVCV is a lot different than some random two word combo that is easy to find and has low liquid value.

Brad

In my opinion, I don’t think LLL or ultra-premium domains ever even go up for wholesale or liquidation (unless the seller needs some quick cash).

I’m more so talking about ‘good enough’ domains - e.g. word pairings that make sense, are are short, are brand-able, etc.

So true. Adding to the discussion, for the wholesale section on Atom, they say this:

"Set a price for wholesale buyers. Typically this price is 40% or below of retail price."

This is precisely my point - the reference percentage that Atom provides is wildly different from what has been posted on this thread.

 

[bmugford]

In my opinion, I don’t think LLL or ultra-premium domains ever even go up for wholesale or liquidation (unless the seller needs some quick cash).

I’m more so talking about ‘good enough’ domains - e.g. word pairings that make sense, are are short, are brand-able, etc.

If the primary selling point is the domain "sounds good", then the wholesale value is going to be lower than a combo with many obvious end users.

Things like popular phrases, formats, etc. will have a higher ratio when it comes to wholesale value.

It's really on a per domain basis. There is no set formula.

Brad

 

[MrMDMF]

Things like popular phrases, formats, etc. will have a higher ratio when it comes to wholesale value.

It's really on a per domain basis. There is no set formula.

Brad

I think we discussed this before, and I agree. However, while each domain is different depending on who is willing to pay for it, I think it's essential to quantify ranges for reoccurring qualities in a domain to establish a more sustainable market.

 

[Kyle Tully]

I think we discussed this before, and I agree. However, while each domain is different depending on who is willing to pay for it, I think it's essential to quantify ranges for reoccurring qualities in a domain to establish a more sustainable market.

The beauty (and challenge) of domains is that each truely is a unique asset and everyone will assign different values to each one.

This is where your opportunity is

 

[VivifyDomains]

Somewhere between 1% - 10% of the perceived retail price from what I've seen

 

[DmytroK.]

Wholesale price is a price profitable enough for seller, and low enough to be considered as "reseller price" for buyer. Profitable for both domainers, seller and buyer. I don't think it's good to sell premium names by wholesale prices for end-users, if you don't know them a lot. There is, as I know, typical pricing for each type of domains, cvcv.com, 2 word .com, 1 word ccTLD, etc., accepted by Market. You should sell your names by this prices. By that way you work for growing domain business in all aspects.

 

[biggie]

Hi

to "non-domainers", there is no such concept of wholesale price.
they only know the price they see, or price you give them, if /when they are looking to buy a domain.

if you can figure the definition of "retail pricing", then the opposite should be wholesale, but in reality, it's not.

imo...

 

[MrMDMF]

I suppose a related sticking point question (for me at least) is how do price my domains for the largest demographic i.e. a perceived bargain for end-users to encourage impulse buying but also enticing enough to a reseller to buy, hold & make their own profit - if there even is such a thing

 

[Molly]

This discussion has been had. Other investors — especially here at NPs, aren’t going to offer more than a couple of percent retail value. See link below.

https://www.namepros.com/threads/is-there-a-middle-class-in-domaining.1329577/

 

[J.R.]

Most Domainers expect to at least 2x their investment.
But top 20% Domainers will say 10x is a minimum retail price.

I have 3 basic tiers for wholesale purchase to retail pricing.
Higher = $10K or more --> retail expectation at least $100K+
Moderate = $5K-$10K ---> retail expectation $25K-$100K
Lower = $10-$5K --> $1K-$50k

There are always exceptions but these are my thoughts when considering a wholesale acquisition.
Hence, I rarely purchase domains because the wholesale price is surpassing average retail sales of $2,500.

Margins are slimmer than ever, so spend wisely.

 

[clarkemarketing]

Wholesale price = close to what it would sell for at auction. If it's a liquid domain such as 4L.com or 5N.com it's obvious what an approximate wholesale price would be. For other domains, such as brandables, it may be difficult but most domainers consider about 1-5% of "retail" price to be fair. For example: if the domain is listed on BrandBucket for $4000, it's wholesale price is likely a max of $200.

 

[Kyle Tully]

I suppose a related sticking point question (for me at least) is how do price my domains for the largest demographic i.e. a perceived bargain for end-users to encourage impulse buying but also enticing enough to a reseller to buy, hold & make their own profit - if there even is such a thing

This does not exist.