How Many Domains Should I Own?
So another take on the 1 to 2% portfolio turnover number that is thrown around quite a bit, is to reverse the numbers to determine how many domains you should own.
An owner with 1000 names should sell about 10-20 a year. Now I’m looking at this in the real domaining sense of end user sales at full price. So this is buy it now off landing pages or in aftermarkets or inbound inquiries.
If your selling wholesale, or quick flip or closeout you should be doing 5-10%, if your a full time domainer you need to be doing another 5-10% to pay for lifestyle.
Big Time Domain Names Different
And lastly we aren’t talking about super-premium names, LLL, one words that are usually always worth a 70-200 % of what you paid and are liquid. These names can be sold at any time based on price.
But back to the bread and butter, like expiring names bought between $50 and $200, listing for $2500-$5000. Or registration fee names bought at $10 and listed at $999. So if you buy 1000 of these for an average of $100, thats a $100,000 portfolio. If you can sell 1% or 10 names a year at $3000 each, thats $30k in revenues, less 9000 in renewals and you make $21k per year.
So if your only selling 5 names a year and you own 1000, your going to be behind, and what your owning and keeping better have better days ahead, because there is nothing happening now that tends to confirm that your buying the right names. And once you start renewing, the numbers get worse.
Let look at some more scenarios, last year you sold 20 names at $500, and you buy reg fee names. So lets take the 20, times 100 if your doing 1% and you can buy 2000 names, thats $16,000 in reg fees or renewals, and you do $10,000 in revenues, so you lose $600 a year. So if your buying registration fee names, you better be doing 3-4% to make money, more if your also paying for your lifestyle.
So if you own close to 2000, names are you selling 20 a year, it might not be profitable. Buy less, buy better.
Pro Domaining Tip
Or secondly, you need your names to be moving up in category. You need some percentage of your reg fee names to be able to bump up into the category of $1500-$2999 names to be breaking even, and again even more if you need to tax your portfolio for your lifestyle.
Again, now percentages don’t apply if your a liquid premium domain name buyer. If your buying wholesale trade-able names for $500 and up. You can determine how much money to make by whether you accept low or medium or high offers. So you may say I’ll sell 1-2% of my portfolio for full price 10-20k per name. So on 100 names, 2 sales a year is $40k in revenues. If your selling 1-3% at full prices, keep buying, if not, your pricing too high. But, if you drop prices to 2-3x what you paid, you may do 10-20% of your portfolio in sales.
Am I hitting home with these type of posts, off-base? Comments below.