If you’re under the impression that e-commerce is a massive industry and one that is going to grow even more, then you aren’t far wrong. It is said that there is anywhere between 12-24 million e-commerce businesses from all around the world existing online right now. E-commerce gives people the opportunity to sell all kinds of products to a much larger market, as you aren’t restricted by location or the size of your brick and mortar shop.
For those who have been wanting to open their first e-commerce business but are feeling a little hesitant and unsure of where to start, let this act as your step-by-step guide. We’ll take you through the process, dispel the myths, and lay out the steps in simple terms so that it doesn’t seem overwhelming or scary.
What Products Will You Be Selling?
First things first, what do you plan to sell? Do you want to sell a variety of items or do you plan to specialize in one particular niche? The thing to keep in mind is that you have to be wary of how the products translate online. They should be straight-forward and easy to understand through photos and videos if needed.
If you’re having a hard time figuring out what you should sell, it can help to check out other online stores and see what the competition is doing. As well, you can look at your own purchasing history, chat with your friends about what they buy online, and look at the best sellers list on popular sites like eBay, AliExpress, and Amazon.
The goal isn’t to copy what others are doing, rather it is to help ignite your own creative juices and ideas.
What Business Model Do You Want to Use?
It’s also important to think about the business model you plan to use. For an e-commerce store you have the option of having a warehouse full of your product that you will purchase up-front and then sell, or you can sell products without ever physically having it, storing it, and shipping it.
If you choose a business model where you won’t actually be touching and handling the items, this is called dropshipping. For many first-time e-commerce store owners this can be a bit overwhelming, but can be something you look into later on. Each business model has its own pros and cons, so it’s important you really do your research.
If you have any contacts that have opened their own e-commerce business, this can be a good time to speak to them about any advice they may have, especially regarding the “ideal” business model.
Engage in Customer Research
Just as important as deciding what to sell is figuring out who your target customer is. In order to determine this, you’ll need to do some customer research. Customer research will help you develop your product catalogue, your marketing plan, your pricing, and branding.
In order to determine your target market, you’ll need to look at the psychographics (personality, values, attitudes, behavior, etc.), demographics (age, occupation, gender, location, income level, education level, etc.), and consider what the competition offers.
Don’t Price Yourself Out of the Water
Another area that you will want to give focus to is your price point. It’s easy to pick a random number, but that may not end up being the best price point. You don’t need to offer the lowest rock bottom price out there, after all you are in this to make a profit, but at the same time you don’t want to over-price your products and scare customers away.
Most experts recommend that you aim for a 30% profit margin. What this means is that you price your product at 30% more than it costs you.
Spend Time on the Product Listings
As for the product listings themselves, this is often just as important as the price. You need to not only give a full description of the product, but provide multiple pictures from different angles. You are trying to answer any questions the consumer may have about the item, and make it as attractive as possible. You can also add keywords in your product description and title that will help people to locate the items easily.
Use an E-Commerce Platform
Another area where newbies can get pretty overwhelmed is in setting up their own website. Rather than deal with this early on, it can be wise to use an established e-commerce platform such as Amazon in order to list your items.
Amazon FBA (Fulfilment by Amazon) allows e-commerce store owners, such as yourself, to ship the items you sell to an Amazon warehouse. From there, Amazon will look after the picking, packing, and shipping of your products. This also means you can take advantage of Amazon’s famous free two-day Prime shipping deal; something else that will attract consumers to your products.
Now, one thing you will want to keep in mind is that as an FBA seller, there will be many points in which Amazon likely owes you money. It’s just normal for Amazon inventory management to make mistakes considering how much they store and process. There can be mistakes made with damaged goods, inventory that has gotten lost, or even destroyed too.
While there are ways to go about getting back the money you are owed, it can be time-consuming and even confusing. This is when it’s helpful to look into services like AMZRefund. This service works by doing all the legwork for you, analyzing your inventory history, and then finding any FBA errors. You won’t have to pay for the service until you are guaranteed reimbursements.
As more and more e-commerce stores pop up, there is no need to fear that this trend will be dying down anytime soon. There is no time like the present to get in on the action.
Mark Armstrong started off as a business consultant for small SEO and web design companies. Soon enough, he got more and more involved in the actual management and editing of the websites that he used to consult, which woke up his writer side. From time to time he always tries to contribute to the community and write articles that will be helpful and informative.
