For aspiring entrepreneurs having an online store comes with a lot of benefits. Having an online store can allow you to work flexible hours, build a brand name, and to start with a much smaller investment than what a brick and mortar store would require.
But having an online store will also require a substantial amount of time and energy. Here are some of the most important things to consider before opening up an online store.
Profit margin is a pretty simple concept, but it is surprising how many people try to conduct business without understanding it. The profit margin is the amount of money you make on a sale minus the expenses. Expenses include sales tax, the price you pay for the product, and the cost of shipping.
Not only is it important to consider where you will put everything that you are storing for your online store, it is also important to consider how you will keep track of it. Do you want to have a handwritten inventory spreadsheet or a digital one? Also, consider the ease of access, if you need to stack boxes to the ceiling in order to store everything, when you receive an order for the product in the bottom box you will have a lot of rearranging to do.
Are there enough people who would be potentially interested in your products? For instance if you want to sell general electronics, that will provide you with a wide customer base since everyone buys electronics, but if you want to sell t-shirts with the logo of a small university on it there will be a lot less people interested in your product. By the way, a small customer base is not necessarily a bad thing, as long as there are enough potential customers to support your business, which takes us to our next point…
Who is going to want to buy from you? As I said above, if you have a small customer base that is not necessarily a bad thing, as long as there are enough potential customers to support your business. Serving a niche gives you the ability to connect with a certain group of people. For instance, if you provide a service to a certain religious group, or school, or interest group (like bird watchers for example), you can become everyone’s loved and trusted provider.
Are You Inspired?
Any business pursuit comes with its share of difficulties, those who are truly inspired by what they are doing will have a lot more gusto to overcome the inevitable difficulties. It’s best to be involved with a product or niche that you are passionate about.
Can they get Your Products Cheaper Elsewhere?
Competing on the internet means your customers can check out the prices at Amazon or any other website in seconds. There are even price comparing websites where people are able to find the cheapest deal. If you want to sell products which are available for cheaper elsewhere, you need to consider why they will want to buy from you instead.
Packaging and Shipping
I worked for an internet based yarn store once, and I was very surprised to learn how time consuming packaging and shipping are. Consider that those things will take up a lot of your time and energy especially if you go down the route of creating personalized shipping boxes.
How will customers learn about you, and what will you do to engage them? Having a plan for marketing through search, social media, and/or advertising is a vital component of making sales.
Marketing also requires a substantial investment of either time or money or both.
Good luck with your online money making pursuits.
Author Bio: Susie Brown is a FastUpFront Blog contributor and business author. Fastupfront offers a business loan financing alternative based on business cash flow. To apply for business financing visit FastUpFront.com
By: Susie Brown