As an prior e-commerce business owner, I have seen too many people decide to start an e-commerce business because they think it will be an easy way to make some money. However, businesses based on an e-commerce platform are not much different than a traditional brick and mortar store.
You need to have a detailed business plan which includes sales goals, a summary of financial resources, and specific strategies to meet your goals. Below are some of the best tips for those looking to start a successful online business using an e-commerce platform.
Do something you love
An online e-commerce business takes a good amount of time. Go into online sales because there are aspects of it that you love. For instance, some vendors who love fashion have successfully spent hours finding gems in thrift stores and selling them for a significant profit. If you love high-fashion sunglasses, you will know how to identify genuine designer sunglasses from knock-offs. Other people have had success finding and refurbishing antique furniture to later sell at a great profit. It is more than possible to make an e-commerce business successful. But, you need to put in the work.
Look into drop shipping
Some certified vendors can do very well by setting up a drop shipping system for goods. For instance, a certified vendor of brand name appliances can sell products on an e-commerce platform before ordering them. Instead of having a warehouse full of bulky inventory, you can place an order with the vendor for every sale you make and have the vendor ship the product directly to the consumer. Although this approach can be highly lucrative, you need to be a natural at customer service.
Given that you are not directly shipping the orders, things can go wrong. You will be responsible for coordinating with other service providers remotely (e.g. the shipment and delivery service) as well as customers to ensure that all products are delivered up to standard. You can place larger orders this way, but you have to enjoy wearing many hats as a sales rep, customer service provider, mediator, and back end coordinator simultaneously.
Instead of spending time to save 25 cents, make sure that you earn a significant margin on all sales. Do not obsess over small expenses. As the saying goes, nickel and dime yourself instead of your customers. Some vendors have sported Frankenstein-like creations involving multiple boxes and lots of tape for the sake of getting free boxes. New businesses in general involve trial and error. Before blindly investing a large amount of money, test your plan on a smaller scale to see if it might be viable. Although you might have a fantastic idea, having a few “test runs” can help you refine it to make your idea maximize profit.
Take charge of your business
Automated systems can make everything more efficient. Look into software designed for specific e-commerce platforms. Instead of spending an enormous amount of time reposting sales or auctions, many different types of software can post auctions or sales as well as keep track of past and present inventory and sales. Also consider investing in basic accounting software in the event you hire a few employees. A few other insider tricks include getting free shipping materials by signing up with major shipping companies. A delivery man can come to your door and collect items to ship daily. By streamlining processes and having a strong level of organization, you can save time and money as well as increase your overall earning potential.
How to have a successful e-commerce business in a nutshell
Focus on something you love instead of something that you think you can make easy money with. Whereas some people are enamored with a certain product—whether that involves finding hidden treasures in thrift stores or refurbishing antique furniture or old video game systems—other people love spending time perfecting various systems and the excitement of acting as a one-man or woman business. The perfect match can be difficult to find. You have to ask yourself what you love and what you want to dedicate most of your waking hours to.
Whereas selling old books, clothing, and other odds and ends around one’s house on an e-commerce platform can help most people earn a little extra cash, owning and operating a full e-commerce business is very different. With your own business you have more freedom, but you also have more important choices to make and increased responsibility.