What is Reseller Price?

crisscross · May 29, 2009

I noticed people using the term reseller price in the context of buying or selling domains. I understand it means that it is lower than what someone would pay or get in a regular auction, but how much lower, and what is the justification for a doing a transaction at a reseller price. Why should anyone be willing to sell at a reseller price?

Many thanks for your response.

kengreenwood · May 29, 2009

Getting a "reseller price" means you're selling to someone who is ultimately looking to sell the domain to an end user. So, you're going to make less money than if you sold directly to an end user.

Here's an analogy: Let's say you have an old Volkswagen Beetle that's in really good shape. You want to sell it... you take it to a used car dealer and he says he'll buy it from you... so he gives you 2 grand in cash and slaps a sticker on it for 5 grand. The next day, a guy who owns 5 vintage Volkswagen Beetle's drives past the dealership and sees the one you just sold to the dealer and he loves it. So he buys the car for 5 grand.

Obviously, you would have loved to have known that this buyer existed before you sold the car to the used car dealer.

The trick to successful domaining (imo) is finding that buyer and avoiding having to sell to other domainers. Selling to another domainer is easier and quicker... finding that end user takes more legwork but pays off in the end.

Rockefeller · May 29, 2009

...below market value

Biggie · May 29, 2009

kengreenwood said:
Getting a "reseller price" means you're selling to someone who is ultimately looking to sell the domain to an end user. So, you're going to make less money than if you sold directly to an end user.

Here's an analogy: Let's say you have an old Volkswagen Beetle that's in really good shape. You want to sell it... you take it to a used car dealer and he says he'll buy it from you... so he gives you 2 grand in cash and slaps a sticker on it for 5 grand. The next day, a guy who owns 5 vintage Volkswagen Beetle's drives past the dealership and sees the one you just sold to the dealer and loves it. He buys the car for 5 grand.

Obviously, you would have loved to know that this buyer existed before you sold the car to the used car dealer.

The trick to successful domaining (imo) is finding that buyer and avoiding having to sell to other domainers. Selling to another domainer is easier and quicker... finding that end user takes more legwork but pays off in the end.

pretty good analogy

i would add that "reseller pricing" is effectively being "influenced" by forum sales, the websites which document these sales and discussions about premium letter breakdown values.

the published lists and or values that come from these sites have been used to set budget ranges by many domainers for purchases and sales, in the reseller market.

they see a range and figure all similar names within, should be bought or sold at those prices.

the breakdown of whether each specific letter in a LLL or LLLL fit a "premium" standard or not, has an effect on how some domainers actually see value in a domain, rather than seeing the domain as a whole.

however, within that "reseller" market, the levels of knowledge and experience of some domainers allows them to set and get their own pricing, irrespective of the lower price ranges.