Many people want to start an E-commerce business these days, but a lack in experience can cost you dearly when you start any type of business for the first time. A successful business starts by choosing a marketable product, but does not stop there. There is a lot you need to know about starting and running a profitable E-commerce business, so let’s have a look at some insider tips from successful E-commerce traders.
Finding a marketable product
The product is your starting point. What do you want to sell? You might already have some ideas, but there are some crucial questions you have to ask yourself before you even consider buying stock.
- Is there a high demand for this product? Will I be able to shift my stock?
- How much competition will I encounter?
- What is the average markup for my product?
- What will the shipping cost be?
Your product needs to be in demand in order for it to sell. You can also choose to go for a niche market, where you will have less competition but speak to a smaller amount of potential clients. Whichever one you choose, it highly depends on your budget. A niche market is generally better when you have a smaller budget, since you don’t have to get a very large range of products. Only sell common products, for example cosmetics, when you have the budget to do so. But with popular products also comes competition. If you would choose to sell cosmetics, you would be going up against cosmetic giants that have the money to offer special deals and discounts. So if you decide to do this, realize that you would need a very large variation of products and the ability to offer your products at a cheaper price to attract clients.
Research before you buy
Research is probably the most vital part of your E-commerce business, because you don’t want to spend money on products that you simply cannot shift. When you research, you will need to Google your product and take a look at your potential competitors. Do not forget to take a look at eBay or Amazon, since many consumers are now using these platforms for the majority of their online purchases. When you start to research the marketability of your product, you will need to find an answer to the following questions:
- How many competitors will I have in my country or region?
- Can I offer my product at the same price or cheaper than my competitor?
- Can I offer my product in such a way that it becomes more attractive for customers?
- Is there a way I can stand out from everybody else?
Only when you have a definite and clear answer to these questions, you can consider your product viable. It is not worth starting your e-commerce business if you cannot find a way to compete with others.
Finding a reliable supplier
Once you have found your product and researched it thoroughly, you can start your search for a decent supplier. Many retail sellers buy their products from China, simply for their cheap buy-in price. However, a lot of these sellers are surprised by the extra cost and danger that comes with buying outside of the United States. As a buyer you can incur import costs or even deal with stock not arriving at all.
The shipping time of products from China can be incredibly long as well, which can give you problems when you need to restock. Can you really wait three to four weeks when you urgently need to buy more stock for an interested client? The trick to success is finding a local supplier who can send the products fast. You might even be able to take advantage of free shipping, which saves you money.
One problem you might encounter is that local suppliers do not have the attractive prices you’ll find in China. That is why it is essential to research the recommended retail price of your product first. The most important question is: “Can you sell the products and make a decent profit if you buy from this supplier?” Some wholesalers will have the recommended retail price displayed on their website, but it isn’t wise to always trust these numbers. The actual selling price on other e-commerce sites can be considerably lower, because other sellers might be using the same supplier.
Choosing your selling platform
The choice of a selling platform is not as easy as you think, because there are many things to take into consideration. You have to take into account the amount of potential clients you’ll reach and how you can present your product to them on this selling platform.
Creating a dedicated e-commerce website is definitely a must. It is also worth considering eBay and Amazon, since a large number of online buyers only buy from these websites.
The specialized e-commerce website
It is highly likely that you will have to outsource some work when you start your e-commerce website. If you don’t have any knowledge on SEO or the creation of a website, you should choose a professional to do it for you. However, you need to be careful you aren’t suckered in by “professionals” who overcharge their clients and not really increase your changes to sell.
So what does need to happen in order to get your e-commerce website on top of the search rankings?
- Three high-quality images that highlight your products in great detail.
- Keywords for every image you upload.
- A separate page for each product you offer.
- A home page that displays the “most popular” products.
- Keyword optimized content with a minimum of 250 words for every product.
- Information pages with a high keyword density.
- A professional contact and about us page.
After you finished your e-commerce website, you will have to upload it to popular search engines, for example Google and Bing. Search engines need to be able to find your website in order to display it in the search results. Do take into account that your climb in the search rankings can be relatively slow, since search engines will go through your pages and list them once a week.
The eBay Shop
An eBay seller has a large database of potential clients at his/her fingertips. In order words, even if you have a dedicated e-commerce website, there are still customers you aren’t reaching, more specifically the eBay customers.
There are some things you will have to think of when you start your own eBay shop. Even though you can consider it as an extension of your e-commerce website, it still requires a lot of work. You could hire someone to manage your eBay shop, but this is not always a possibility, especially when you are on a budget.
If you decide to tackle the eBay shop yourself, you will need to do the following:
- Choose a monthly subscription for a basic shop. You can also get other subscriptions that cost a lot more, but to start you are better off with the basic tools.
- When uploading your products to the shop, make sure you use a lot of pictures. The more detailed pictures you can provide, the more attractive your product looks.
- Create an attractive eBay page for every product you upload.
- Write keyword optimized titles, so that customers can find your product easier.
- Professional eBay sellers get extra tools to get their product up in the search rankings, use them to get your pages to their full potential.
- Don’t forget to calculate the eBay fee when you add your selling price.
The various tools that are available on eBay can help you to understand the buying behavior of your target group. It could also provide you with additional insights for a new potential target group. You can see eBay as an extra selling platform, but also as an invaluable research tool.
The Amazon Shop
Another big online selling platform is Amazon, so this cannot be missing as an extension of your e-commerce website. Amazon is generally considered as a more reliable selling platform for customers, so you will find customers there that do not use eBay.
When you decide to start selling on Amazon, you can choose between two packages: the basic package and the professional package. If you are starting your business and are on a budget, you should go for the basic package. You can sell in twenty product categories and pay a small fee for every product you upload.
However, Amazon is not suited for products that are very cheap, especially when you go with a basic package. The fee you pay often outweighs the profit you can make, so you will need a product with a decent markup.
Even when outsourcing some of the work, it is very important to stay on top of everything and check the work your outsourcers are delivering. This is not an easy task, especially when you run three shops on three different platforms.
Make a schedule for yourself and incorporate it in your daily routing. You simply cannot afford to blindly trust the people you outsource work to, even when they have been working for you for quite some time. The online selling business is constantly evolving and so should your staff.
Sometimes you’ll have to make difficult decisions and even let people go. This is especially hard when you have been working with someone for quite some time. However, you cannot forget to do what is best for yourself and sometimes you have to be selfish to get ahead in life.
Dare to dream big
Some entrepreneurs are afraid to take risks, even when they are calculated risks. Going into e-commerce is not a stable business and is always evolving. This means that it also requires a special type of person.
A good entrepreneur is not afraid to learn new things and evolve with the industry. You need to have a certain selling skill as well and be confident in it. Research your product and make sure you know what you are talking about. If you do this you’ll be able to answer all the questions thrown at you and inform clients better.
Don’t always think small scale. People who became the most successful, are the ones who dreamed big. Do not mistake this for throwing money at big expensive showcases, because successful people handle their money with great care. Always look for the best deal, but don’t be afraid to spend money to make money.
The most important part of sales is networking. There is no doubt about that. Even though some social skill is required, nothing is stopping you to contact potential clients or businesses who can contribute to your e-commerce empire.
For example, a good relationship with your local supplier can give you better deals and some inside knowledge on the latest products. Don’t be afraid to engage in a personal relationship with your business contacts. Treating your important business contacts or new clients to a meal or giving them a small gift to show your appreciation goes a long way.
Social networking platforms also play some part in the style of networking. However, personal contact is always a hundred times better. As an entrepreneur, you have more chance to leave an impression when you have personal contact with business associates.
It is also a very good idea to create a list with valuable contacts you have acquired and another list for valuable potential business contacts. There are some things you have to take into account when you contact a potential business associate:
- Always treat new business contacts with respect and courtesy.
- Bring something to the table that your business contact will be interested in. Nobody will respect you if you cannot offer something in return.
- Be prepared! Nothing is more annoying than someone who doesn’t know what they are talking about. Make sure you have a decent proposal before contacting anyone.
If you network, you have a higher chance to succeed in the business world. E-commerce is the future, so make sure you take advantage of all the opportunities it can give you.