I dont understand how a site like namebargain makes money. As I understand it, they are an enom reseller so they buy their domains at about $6.50 and sell them at $8.88.

So they make a gross profit of $2.38, is there a point?

But thats not the net profit, I bet they have to pay a 5% per sale on credit card transactions and their hosting over-heads etc.

Is there a point for a such a low return? I wonder how much of the $6.50 that enom charge is enom's profit.... I mean how much to ICann charge its members?

I'd be happy with $2 a sale if I was making 10,000 sales a week. That's $20,000 profit per week.

FYI: ICANN charges $5.99 per domain name per year. enom's pricing for their biggest resellers is $6.95.

Peter

I dont agree, your profit margin is to low... your constantly using an overdraft.

ICANN cant be selling at that price! Its impossible!

Why do SRSplus sell .com names $5.30 at their lowest price?

$6 goes to the Registry.

Did you read my above post? lol

If SRSplus are able to offer domains at $5.30, and they pay ICANN $6 per domain! They are loosing $0.70 per sale.

That does not make sense! I reckon ICANN sell at $5 per year.

Originally posted by blob2
Did you read my above post? lol

If SRSplus are able to offer domains at $5.30, and they pay ICANN $6 per domain! They are loosing $0.70 per sale.

That does not make sense! I reckon ICANN sell at $5 per year.

If SRSplus offers other services, e.g. web hosting, they can afford to offer really low domain registrations at a marginal loss.

ICANN not only charges $6, they are whining now about how low it is and want a raise. But they are bound to the terms of the contract.

Originally posted by blob2
Did you read my above post? lol

If SRSplus are able to offer domains at $5.30, and they pay ICANN $6 per domain! They are loosing $0.70 per sale.

That does not make sense! I reckon ICANN sell at $5 per year.

Just a small correction - SRSPlus offer $5.30 on .biz domains which are not sold by ICANN. Different registry. They offer $6.00 at best on com/net/org which gives them a 1 cent profit. However - you only get that if you can register 250 or more .tv names per month! I think I speak for just about any seller/reseller of domains here when I say that 2 per month would be rare, nevermind 250 :D

Best wishes,
Simon

Yes, your right:

http://www.srsplus.com/en-def-cbf3073d3378/en/srsplus/partners_pricing.shtml

They do only make 1 cent profit, but I believe SRSplus are owned by the .TV registry. So its just an advert to try and sell as many .TV domain names as possible.

But lets get back to main topic, what is the point in selling domain names at such a low price with such a low return.

Hello
I think they base it on renewal value.
They hope to make future profit on 50% of names registered.

Also the rates of $6.50 you see advertised are only available if you put down $1000's.
Very few resellers weill get these headline rates.
You will also find hidden costs (e.g. enom charges 2% on credit card deposits)

Gordon

Originally posted by GordonH
You will also find hidden costs (e.g. enom charges 2% on credit card deposits)

Gordon

You mean 3%

It was just a guess.
I saw it when I passed through their site the other day.
Thought it was 2%

Gordon

In my opinion, anyone pricing domains to where they are only grossing $2 a sale are not serious about making any money in the domain business. I suspect they don't have a viable business plan and will not survive for long without funds from another source.

Even the guy who says he would be happy at $2 per domain if he were selling 10,000 domains a month is dreaming. If you think you can handle the volume of sales support calls yourself and provide any kind of service on 10,000 new domains a month you are nuts. With your $120,000 a year gross profit, you will not even be able to hire the necessary employees to run a real domain registration business.

In my opinion, no one is making enough money on these margins to keep a business viable. Sorry. They are no more than hobby business, and the ICANN registrars who are doing this are either going to go away, have to raise their prices or go back to the venture capital well before too long.

Look at the SOTD report and do the math. There is not enough money to support the business at these margins.

-t

It seems to be a good business in countries like Russia, Romania, Bulgaria, where the average monthly salary is about $150-$250. If there are 4 full time employees, they earn 30.000 / year, that's a pretty good money there, considering the fact that they would never earn more than 4-5000 with any kind of other job.

I dont understand how a site like namebargain makes money. As I understand it, they are an enom reseller so they buy their domains at about $6.50 and sell them at $8.88.
namebargain are a division of register.com
namecheap are enom resellers.