Resources » Blog » Inventory & Sourcing » Know Your Business Valuation: The Complete Guide to Measuring Your Store’s Worth

Know Your Business Valuation: The Complete Guide to Measuring Your Store’s Worth

You’ve worked hard to build an ecommerce store and you know it’s worth something, but do you know how much? Here’s how to understand your business’s valuation.

How much is my business worth?’

If you’ve ever asked this question, you’re not alone. 

Selling your store can have huge emotional and financial implications, so it’s important to keep an accurate and up-to-date estimate of exactly how much your business is worth. The problem is, without the right tools, assessing your store’s value is a complex task.

But it doesn’t have to be.

Our analytical business valuation tool, Sellers Signals (or ‘Signals’ as it’s affectionately known), is designed to create in-depth business reports in one central spot. Built with busy ecommerce entrepreneurs in mind, Signals helps you gain clarity on your store’s overall health in a matter of minutes.

In this article, we’ll explain why an accurate business valuation is crucial and go into detail on how Sellers Signals can help you uncover your store’s value, fast.

The scoop on knowing what your store is worth

  • Why it pays to have a reliable business valuation for your online store
  • How to value your store (with a little help from Signals 😉)
  • The best way to get a valuation for your growing ecommerce brand

CTA: Don’t want to waste hours manually calculating your store’s value? Let Sellers Signals work it out for you.

Why it pays to have a reliable business valuation for your online store

Assessing your store’s value is a complex task — and a basic Excel sheet just won’t cut it.

To get the job done accurately and efficiently, there’s really only one option: 

A digital business valuation system that keeps you updated in real time.

[IMAGE SUGGESTION: GOALS DASHBOARD / Caption: With a little help from Sellers Signals, you can set, track and visualise your most important goals and KPIs in one easy-to-use dashboard.]

Whether you’re hoping to systematize, scale, or sell your business, there are countless benefits to having a firm grip on your core goals and KPIs.

Here are just a few of the top reasons why an accurate business valuation is crucial to building a futureproof ecommerce brand:

  • Ecommerce is constantly changing: The ecommerce landscape is evolving fast — which means so are the trends that impact your store’s value. A real-time business valuation will ensure you always present the most accurate numbers to potential investors.
  • Business valuations are a door opener: One of the most important things you can share with a potential buyer is a business valuation that shows your store is a great investment. Investors want to know how your company performs financially before they dig into the everyday workings of your store.
  • Manual valuations = costly errors: When you use manual tools to conduct business, it’s easy for errors to appear. A well-built business valuation reduces the margin of error, so you can say goodbye to inaccurate valuations that cost you money.
  • Get your store on (and off) the market faster: As a busy seller, you already have multiple tasks on your plate. You may find yourself having to rush your valuation, or even shelving the idea altogether. On the other hand, with a purpose-built tool to do the groundwork for you, you can save time and get your final valuation sooner.
  • Gain confidence and clarity: With an accurate and up-to-date business valuation at your fingertips, you can wave goodbye to the guesswork and gain the confidence and clarity you need to find the perfect buyer. 👌🏽

CTA: Thinking about selling your store? Use Signals to increase your odds of success.

[PULL QUOTE: Add quote + title and company name: “If I need to explain my business, everything I need to know is in Signals. I literally just copy and paste it, it’s amazing. I haven’t seen a tool like this anywhere before.” — Jon Drummond, Owner –  Living Water Goods and Products

How to value your store (with a little help from Signals 😉)

To build a complete business valuation that shows off your store’s stellar performance, first you need to pinpoint some key features and metrics. 

Let’s explore some must-have business valuation metrics to help you gain a clear picture of your store’s value.

Hassle-free Profit and Loss Statements

A great way to highlight your store’s success is by showing positive cash flow. 

That’s exactly where your Profit and Loss (P&L) statement enters the picture.

Your P&L statement reveals whether your sales exceed your expenses or not. They also contain these three KPIs that help measure your store’s selling patterns:

  1. Gross Sales
  2. Net Sales
  3. Cashflow

Track your store’s success with the P&L dashboard inside Sellers Signals 

From the moment you hit the P&L tab, Signals greets you with a detailed breakdown of your store’s current P&L statement without needing to do calculations yourself. You can also look through your store’s P&L for the last 12 months to uncover when your store performs the best, as well as any slow periods or key seasonality factors.

Now you can instantly compare your gross and net sales to keep your finger on the pulse of your store’s profitability (even when working with multiple currencies!).


Sales forecasts to predict future growth

No one can know the future, but with an accurate sales forecast, you can get pretty close. 

Sales forecasts help maintain optimal inventory levels and avoid costly overstocks and stockouts, so you can keep your store profitable and boost your asking price. 

Buyer and investors pay close attention to your sales forecasts, so this is one to keep an eye on from day one.

Assess your store’s scalability with Signals’ sales forecasting 

Whether you need to know how many sales you’ve got over a week, month, quarter, or year — Signals has you covered. Signals builds well-rounded sales predictions by using your previous sales data in its forecasting models — allowing you to easily gauge whether your sales are on the right track and set realistic expectations for any given time period.


Straightforward customer feedback to optimise your store

Customer opinions are vital for success — especially when you sell on marketplaces like Amazon where customer feedback can impact sales and ranking.

It might not be immediately obvious, but tracking customer feedback can come with huge rewards. Not only does it highlight your successes, it also shows where you can improve to secure even more sales and loyal customers. 

Plus, great customer feedback is a simple way to show potential buyers the value of your store and increase your chances of making a killer sale.

Easily track customer feedback

With Signals user feedback report, you can see what your customers really think, in just a few clicks. You can also analyse the percentage of positive vs. negative reviews each month and compare them to specific time periods or milestones. Plus, Signals enables you to predict your performance at the beginning of each month so you can estimate how much feedback your store can expect to collect.


Product performance analysis for a profitable portfolio

You’ve invested time and money into great products. But how do you prove their value to potential buyers? 

The answer is simple: Product performance analysis.

A product performance analysis gives insight into your product portfolio by tracking all your SKUs and ASINs. But be prepared — monitoring your products manually can be a major undertaking.

Fortunately, there’s a solution for that too. 😉

Assess inventory performance with Signals’ product analysis

Every store has its winning products, slow movers and rising stars. But when you have a high volume of products in your portfolio, it’s easy for some to go unnoticed. 

With the product analysis tool in Signals, you can reduce the chances of missing key product performance data by assessing your store, SKU by SKU.

Here are a few ways Signals can help you assess and prove the value of your product portfolio: 

  • Integrate Amazon ad accounts for a funnel breakdown of your store’s impressions, clicks and conversions to generate a 360-degree view on product performance. 
  • See the real breakdown of your Advertising Cost of Sales (ACOS), Cost Per Click (CPC), and Return On Ad Spend (ROAS) and their impact on product success.
  • Reveal your best-selling, trending and lagging products with Signals’ Products Impression Rank.
  • Check out the product summary for a full breakdown on your Total Advertising Cost of Sales to show how many sales your ads brought in over the last 30 days.
  • Get a full breakdown on the following KPIs to ensure your products are profitable:
  • Net sales Your gross sales minus selling fees, advertising fees and discounts.
  • Return on Investment (ROI) How much you’ve made back on your investment.
  • Margin per unit The difference between the product’s gross and net revenue divided by units sold.
  • Average revenue per unit The item’s net sales divided by units sold. 
  • Complete list of Amazon fees per product.


One simple metric that summarises the health of your store

If the goal is to sell your online store, you’ll need an easy way to show potential buyers its value. 

You could spend hours upon hours compiling awards, press releases and cash flow statements — but imagine if you only needed one score to sum it up.

With a little help from Signals, it can be as easy as assigning your store a classic letter grade.

Quickly analyse your store’s value with the Visinger Score

Signals’ proprietary algorithm, the Visinger Score, uses key information on your Amazon store’s behaviour to analyse your overall performance, without compromising on accuracy. 

The Visinger Score ranges from 0-1000 with 5 categories ranging from Low to Excellent, with a corresponding letter grade from A to E. You can even check how your Visinger score has changed over time to see if your store is on an upward or downward trend.


The simplest path to a clear valuation of your growing ecommerce brand

As the ecommerce world changes and develops, there’s no doubt your store will too. 

To stay ahead of the game, it’s important to keep an eye on your store’s current value and what you need to work on to increase its asking price. 

A smart business valuation solution is key to building a complete picture of your store’s revenue and profits — so when buyers come knocking, you’re ready to show off your success.

CTA: Need help valuing your ecommerce business? Let Sellers Signals do the heavy lifting.

I would include a screen of the Business Valuation report somewhere, probably at the top. Here it is:


Connect and keep up with SellersFi

Subscribe to our free monthly newsletter.
And keep up with us on social to never miss a thing!

Related Articles