Advice Needed - Business Owner Lowballing Me

[pixel42]

I received an offer on a name two days ago, that was a recent backorder for me. It's a personal name (along the lines of Simons.com), and I got it because I liked it - but it turns out that it used to be associated with a company in the UK that makes & distributes mulled wine.

The guy who emailed me runs the company (according to Linkedin), as well as a site called XXXXX, which sells a variety of products related to packaging and recreation. I don't think the mulled wine site was active this past year, and I think it was registered to someone else, which is why it was allowed to lapse.

His initial email just said he was interested in acquiring the name, and asked how much I wanted for it.

After I did the necessary research, I figured the ball was in my court because he clearly had a specific purpose in mind for the name. I didn't want to name an exorbitant price, so I emailed back that the BIN was $1000 and that I was flexible on payment terms and could accept installments.

That was too high for him. He wrote back that it was too expensive, so he'd have to leave it. I told him no problem, that I completely understood, and that if he changed his mind, the domain is listed for sale on Sedo (I set a suggested price of $995 and "Make Offer").

This morning, there was an offer of $200, and a note saying my price was too high, but that he was still interested.

Now...I'm all for being flexible with people and for all I know, even though he appears to run several businesses, maybe business isn't good, and $1K is really high for him. But I looked at the part of his site that includes the mulled wine products, and they have over 2 dozen pubs and wine stores in the UK selling their products. They're about to hit the holiday season, which is probably their most lucrative time.

My question is: how do I respond to this guy? Do I tell him I know any of this information? Am I wrong in thinking that $995 is a fairly reasonable amount, especially if it can be split up?

I don't know why he's trying to lowball me, when he clearly wants the name. I'd feel bad if the price is really too high for him, but for me to sell it for $200 (before commission) is ridiculous.

Any advice is greatly appreciated!

 

[INFORG]

He senses you are soft on price, so he is trying to get it cheap. Don't back down - he will come up to your 1K price or close. You should have started higher IMHO.

 

[pixel42]

Thanks, 2gaj. I probably could have started higher, but I just wanted a quick sale. I'm not backing down, which is why I didn't adjust the price after his initial email. But how do I respond to his offer? Should I mention anything about his business, or just counteroffer with my original price? I should have set it to "Buy It Now" instead of "Make Offer." I had a feeling this would happen, but I was hoping the guy would reconsider and decide he wanted the name once he saw it was publicly listed for sale.

 

[hugegrowth]

1) tell him a second party has contacted you about this name and has offered $750

or

2) tell him you just sold another domain and don't really need the money now, so the price has gone up to $1500.

but seriously, given the details you've mentioned $1000 doesn't seem much for the domain. if you're price was in US dollars, remember the US dollar is near a low now compared to UK pounds or euros. also, the purchase should be a business write-off for him I would think.

 

[INFORG]

You could say one of a number of things:

"We both know this is worth my asking price, I'd have started higher, but wanted to save us some time - I can't go any lower on this one"
"I now have someone else inquiring about this name - I can sell it at $995 first come first served, or if you offer $750 via Sedo, I will push it to auction and let it go for whatever it reaches"
"It really is worth more to me in development potential - I don't acquire cheap names and I don't sell any names below the high XXX range"

I've had good luck in this type of situation with the auction gambit - they don't want to let it go to auction.

 

[hugegrowth]

I guess the guy feels it is worth his time to do some back and forth with you to get a lower price.

So just be firm on your price if that is what you really want, and maybe his next offer will be 800 or 900, or the full amount.

 

[Theo]

If you're interested in a quick sale, be prepared to take less money.
Otherwise, explain firmly but politely what your minimum asking price is. Don't get into arguments with the buyer about the number of pubs he owns. Everyone values their worth differently.
If needed, end all communications. A serious buyer that understands he's offering too little, will return with a fatter check.

 

[dn-101]

Change the whois & let him know there is a new owner & a new price

 

[Biggie]

If you're interested in a quick sale, be prepared to take less money.
Otherwise, explain firmly but politely what your minimum asking price is. Don't get into arguments with the buyer about the number of pubs he owns. Everyone values their worth differently.
If needed, end all communications. A serious buyer that understands he's offering too little, will return with a fatter check.

i'm in agreement with this advice

but i don't think you analyzed the results of your research properly



since you stated they had plenty of stores and saw an anticipated of increase in sales due to upcoming holidays, by submitting a price of $1k i think you lowballed yourself.


if you had of asked for $10k, what would be different now?


at this point, if you don't want to sell for $200, then counter back with the $1k amount and be ready if he walks



good luck


imo...

 

[pixel42]

You could say one of a number of things:

"We both know this is worth my asking price, I'd have started higher, but wanted to save us some time - I can't go any lower on this one"
"I now have someone else inquiring about this name - I can sell it at $995 first come first served, or if you offer $750 via Sedo, I will push it to auction and let it go for whatever it reaches"
"It really is worth more to me in development potential - I don't acquire cheap names and I don't sell any names below the high XXX range"

These are all GREAT suggestions, thank you. I can see how #2 is very effective - he wouldn't want to risk losing the name.

If needed, end all communications. A serious buyer that understands he's offering too little, will return with a fatter check.

I'd considered that, and may take that approach, although I also like 2gajgops' response from above. I'm prepared to take less than I quoted, but not $150 (which is what it would be less the Sedo fees). Walking away seems riskier than the other approaches, but I really feel I have this guy on the hook, and that walking away was what he was trying to do to me with his initial response.

He went and signed up for a Sedo account to place an offer last night, within hours of me telling him the name was posted. I'd put him in the "motivated, high interest" category.

since you stated they had plenty of stores and saw an anticipated of increase in sales due to upcoming holidays, by submitting a price of $1k i think you lowballed yourself.

if you had of asked for $10k, what would be different now?

You're right, I did back myself into a corner, to some extent. But I figured a nice, round number (that wasn't too high) would be easier for him to digest. I thought $5-10K might qualify as extortion, as I'm not looking to bleed anybody dry, just get a return on my investment (although a return greater than $100).

I should have probably aimed higher to give myself more negotiating room - now I know. I was just trying to be fair, because the guy knows this was a relatively new acquisition for me (although not a fresh registration, so it wasn't reg fee).

I'm probably going to post the name on my Twitter later today to get a few hits on the offer page, and either give him the line about the auction, or walk away.

Thanks for the advice, everyone!

 

[floname]

If he thinks the domain could wind up in the hands of a competitor, he'll meet your price. I would stay within the realm of your original $1K price and make it a BIN listing. He'll be back..

Good luck with it sweetie

 

[Biggie]

Walking away seems riskier than the other approaches, but I really feel I have this guy on the hook, and that walking away was what he was trying to do to me with his initial response.

in your situation...walking away is the only way to get more money or a higher offer next time



and i don't think he was trying to get you to walk away, he was looking for a great deal




side note:

i got an offer a few days ago, for a non .com domain

after going back and forth, the buyer sent an offer with comment ...This is my final offer

which was cool, as i always expect that



so i sent them back my counter offer, with comment.... Thanks for your interest in our domain name


over the weekend, they sent another offer, which was higher than their last offer.



so, in essence...it wasn't their final offer

 

[Gerry]

If it is the ¥¥¥¥ Products that I am familiar with €€€€ and you are holding a domain related to a product of theirs...

what you consider lowball may be a fair offer.

---------- Post added at 12:30 PM ---------- Previous post was at 12:29 PM ----------

Plus, now that you have mentioned the name of the company (industry) this entire thread has now been cached and indexed and is viewable by anyone.

 

[pixel42]

This is now the latest response:

I write to advise you that I consider you are a cyber squatter who seeks to make an unfair and exaggerated profit from the premature purchasing of a URL which I can prove should belong to my company, XXXXX Ltd. This company purchased the assets of XXX Ltd – which included the intellectual property in the form of patents, trademarks and URL’s – one of which was Domainname.com which you obtained incorrectly. I know this url lapsed, but that was entirely due to the host of the xxxx.com website the registrar simply refusing to release the URL due to xxxx Ltd owing them money, despite the fact that I could provide full legal evidence that I had acquired the assets after the company failed. However, when I noted that the url was soon to expire I decided that I may just as well wait a little while then simply buy the url again, for the usual few dollars. However, when I came to do this a few hours after it was released I noted you had swooped in and bought it.

Accordingly I have to notify you that XXXX Ltd has full legal claim on the right to use eliots.com URL, have made you a fair and reasonable offer via Sedo of $300 and now feel that your latest comment – “I have someone else interested” as simply further evidence that you purchased the URL as a cyber squatter, not with any serious intention of using the URL and accordingly ask that you accept my offer of $300 to avoid me progressing the matter through the US legal system.

I can provide evidence of the legal ownership of XXXX Ltd assets , including the inclusion of this URL, via our Intellectual Property Attorney - So-and-so [[email protected]]. Also if you visit our website: xxxx.com you will note that we have many references to the XXXX brand.

Your early response would be appreciated.

 

[Theo]

Email sent.

 

[Gerry]

It's bullying.

But, if he is right - then what's your recourse?

They may have you by the short hairs for "bad faith".

 

[INFORG]

Without knowing the exact name in question, it is difficult to make an opinion about how generic it is and whether your ownership would hold up if tested. Every domainer has to confront this situation and make a decision that is within the risk level they are comfortable with. Personally, I think this guy is just trying to bully you off of it for cheap. People who have IP attorneys at the ready don't threaten to use them - they use them. Big indication he is likely full of crap.

I'm not an attorney - default disclaimer. I would probably send him a very short email back saying roughly.

I purchased this name because I like it, and have development plans for it.
I was very surprised when I began receiving inquiries about it.
I am content to keep the name for my own use, but would sell this one at my asking price and select another.
I am well aware of how IP works with regard to domain names, and am certain I am well within my rights in owning and developing this one.
Your original offer to purchase the name solidifies and acknowledges my rights in this name.
If you wish to purchase the name at my current asking price, you may do so on Sedo (please check there for latest pricing info).
I will no longer accept any correspondence from you directly, as you are claiming to have legal representation. They should handle any further contact and I will deal with that as an attempt to reverse hijack a domain name and act accordingly.

I deal with this "I talked to an attorney, or I have an attorney" stuff in employee situations too. I usually just stop the conversation and tell them since they have an attorney involved I can't really discuss it any more. Have their attorney (who usually doesn't exist) initiate formal contact, and then I will decide how to proceed. Then they start to backpedal and you can deal with them a little easier.

Just my .02

 

[floname]

Your original offer to purchase the name solidifies and acknowledges my rights in this name.

I will no longer accept any correspondence from you directly, as you are claiming to have legal representation. They should handle any further contact and I will deal with that as an attempt to reverse hijack a domain name and act accordingly.

Nice...

Before it potentially gets too ugly, do some research and attempt to confirm his claims or ask him to provide the aforementioned proof.

Call his bluff...

 

[pixel42]

Thanks, everyone. This was resolved this morning.

I felt it was a bluff, as well. Although he had some valid points, the name wasn't registered to him at any point, and a search of the UK and USPTO trademark sites revealed no active listings for the name. There hadn't been any active site on the name since 2007, and although the lawyer he listed was a real person, the email didn't come from her office, and wasn't copied to her.

I decided to appeal to his desire to get this over swiftly and without the hassle and expense of legal fees, and decided to meet him halfway on the price. I said if he would put forth an offer of $xxx on Sedo, I'd approve the sale and have the name immediately transfered to him, and he did. At this point, all of the necessary documentation has been exchanged, so it should be a done deal tomorrow.

Thanks for the input!