As a result of its explosive growth, the Internet has become a business arena for merchants. Moving a business (fully or partially) to the Internet allows merchants to increase their profits and become more competitive in today’s environment. Today, we will take a look at what mistakes entrepreneurs who want to open their own online stores often make and what they need to do to increase their chances of success.
- Starting an Online Store from Scratch
Starting an online store from scratch is a marathon, not a sprint. If you do everything right, you won’t get an influx of free money until a few years after you start your store. Why does this usually happen? Suppose you buy a small sample of merchandise of $2,000 worth. Your sales begin to flow. What do you do with the money? Of course, you will invest this money in the development of business: expanding the range, advertising, warehouse, equipment, and increasing the volume of purchases. Also look for the best hosting providers. Check siteground alternative.
Starting an online store from scratch is a marathon, not a sprint. If you do everything right, you won’t get an influx of free money until a few years after you start your store. Why does this usually happen? Suppose you buy a small sample of merchandise of $2,000 worth. Your sales begin to flow. What do you do with the money? Of course, you will invest this money in the development of business: expanding the range, advertising, warehouse, equipment, and increasing the volume of purchases.
There is another key moment concerning finances. When launching a venture, you should separate your company’s assets and your own savings. Registering your business as an LLC will give you that opportunity and, indeed, protect your property.
- What to Trade in the Online Store
Start with a small range. In any case, do not start with a large assortment of goods unless you have a million-dollar budget.
Of course, you can sell anything but first, check the ideas below.
- Choose the Niche
If you will only have a narrow range of goods, then you can provide a more extensive range and bypass even the biggest players in terms of turnover.
- Sell Goods that You Like
When you sell a product that you’re knowledgeable in, you better understand the needs of your customers.
- Sell Products that Are Small and Easy to Transport
If you sell small items, you can even set up a warehouse in your home or in a small room at first. If you sell large goods, such as baby carriages, then you will have extra trouble with storage and transportation. Be sure to consider this fact.
- Sell Unique Products
Let’s say the business owner has a jewelry store, he or she will have the following tactic: to buy the whole product from the supplier and thus, the product he or she sells is unique and competitors do not have it.
- Take into Account the Seasonality of Demand
If you want to open an online store selling winter clothing, then take into account that you will only have sales in the cold period of the year.
- Try to Choose a Product that Requires Repeat Purchases
Your best customers are regular customers. The more often your customer has a need for your products, the better. It’s important that the customer doesn’t forget about you until their next purchase. Your strategy for this should be thought through in advance.
- Don’t Hire Employees at Once
If you already have several operating businesses, and your experience and finances allow you to start a new business by hiring an HR and an executive, then this piece of advice is not appropriate for you. But if you’re just starting out on your eCommerce journey, then try doing everything yourself if possible. Once you realize that you don’t have time to do everything yourself, hire people. Read more about how to create a photography website.
- A Recommended Plan when Creating an Online Store from Scratch
Start with product selection. This is the first thing you should do. At this stage, you have to:
- Find wholesale suppliers of products;
- Clarify the possibilities of dropshipping;
- Analyze the competition;
- Calculate what markup you can do on the goods;
- Create a page on Facebook and start selling your product there;
- When you see that your product is in demand, then you should start to create an online store.
- When Do You Need Your own Online Store?
It is better to create an online store if you are confident that you will be able to sell products online or if there is already a stable demand for your products. For example, you are already selling your products on the web, in social networks, or in offline outlets.
If people start an online store directly from the creation of the site, the average survival rate is no more than 30%. We assume this is because people who already have sales understand their customers and their product better.
- Why Do You Need Your own Online Store?
Let’s assume that you have created a website and filled it with goods, but it won’t bring you sales at once. The site and your products need to be advertised. According to our observations, online stores that already had sales before it was created have a very good chance of success. These can be both offline sales or online sales (through a landing or through social networks, blogs, YouTube).
An Internet store helps solve the following problems:
- It automates the process of selling a product;
- It acts as an Internet display case for your entire product line;
- It helps to organize your product availability;
- It is a marketing tool for selling, increasing customer loyalty;
- It allows you to see the main indicators of sales and manage your business systematically.
You will also have other business aspects you have to consider in advance, namely:
- Working with suppliers;
- Selection and purchase of goods ;
- Marketing and increasing turnover;
- Order processing.
- Legal Aspects of Starting an Online Store
It is better to consult with your accountant or tax inspector to choose the best form of ownership. Usually, they recommend choosing either a Sole Proprietorship or LLC services. Anyway, official registration will give you a current account, to which you will be able to accept payments online from the store.
- How to Promote Your Online Store
First of all, you should work on the conversion rate of your online store.
You can increase the conversion rate by improving the website functionality and techniques that improve the conversion rate: promotions, cross-selling, nice UI, complete and high-quality product description, 1-click buying, easy checkout, loyalty program, wishlist, product comparison, cart alert, markers for products and categories (e.g. “best price”), countdown counters, social factors, etc. These are the most important aspects you have to consider.
An online store will be successful only if you keep it busy, expand the number of products, try new ways of advertising, and invest in the ones that give the best return, improve customer service, work on building a customer base, etc. Whether your online store will be successful depends on you, on your personal qualities, your persistence, your willingness to learn new information, and your willingness to work hard for a long time – this is the main key to opening a successful online store.