5 Things to Consider Before Opening an Ecommerce Business
Whether you have always dreamed of owning your own business or simply want another income stream, an ecommerce business can be profitable and enjoyable. However, there are multiple factors you have to consider before opening this type of company.
Figure Out Product Sourcing
If you only plan to sell handmade items that you make in the ecommerce store, then you can skip this step. However, most business owners need to figure out sourcing before opening their website to customers. You have to find the balance between getting the best products at the most competitive prices. From searching through thrift stores to collaborating with large wholesale markets, it is important to consider all of the product sourcing options and pick the right one.
Decide on the Variety of Products
It may be tempting to stock your ecommerce business with a large selection of products, but experts recommend starting with less variety. You may not be able to predict customer tastes right away and having too much inventory can be a problem. For example, you may decide to carry a jacket in 10 colors, but customers are only interested in buying two of the shades. Consider asking potential customers for their feedback by creating easy and free surveys on SurveyMonkey or SurveyPlanet, so you will know which products to include.
Figure Out Shipping
The right shipping process can streamline your entire ecommerce business. Before investing in inventory, it is important to have a shipping plan figured out. You can rent or buy a warehouse to store products and ship them. However, shipping on demand may an easier option. For example, Whiplash offers shipping and fulfillment services, so you do not need a warehouse or other property to store items. They store all of your products, and only ship them after a customer makes a purchase.
Check Out the Competition
Competition continues to increase among ecommerce businesses. Not only do you have to worry about large corporations, small businesses are also important to consider. Pay attention to the competition and make note of what they are selling. In addition, you will see their price points and can adjust your own ecommerce strategies. For example, you can use services like Terapeak to keep track of your eBay competition. You can see sales volume, average prices and other important data points.
Start Planning for Marketing and Advertising
Although you may not be able to implement all of the marketing and advertising strategies immediately after opening your ecommerce business, it is important to have a plan. Keep in mind that strategies may need to be adjusted, so the plan has to be flexible. Common plans include using social media, paying for advertisements, collaborating with influencers or brands, creating conversion funnels, content marketing, SEO, email campaigns and affiliate marketing. Consider using an automated marketing app to help you manage your campaigns efficiently.
As you plan the beginning stages of your ecommerce business, consider these five points. Your business will be more successful if you start to prepare early and focus on the most important factors.