COVID-19 accelerated the growth of eCommerce. If you think that people are going to resume their shopping habits now that the economy is open, think again.
The Ultimate Guide To Starting an Ecommerce Business
Ecommerce sales are predicted to grow almost 18% over an explosive 2020. That’s because many consumers realize the benefits of eCommerce, like the convenience and ability to get a broad range of products.
That makes this a prime opportunity to start an eCommerce business. Starting an eCommerce business isn’t a sure thing because you’re competing against thousands of other online retailers.
How can you start a business and find eCommerce success? Read this guide to learn the steps to start an eCommerce business.
1. Find Products To Sell
You might already have ideas as to what you want to sell. Don’t be the business owner that says, I have an idea and starts selling right away.
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There are several crucial steps between product idea and website design. The first is to know who you’re selling to. This helps your marketing later on.
Right now your job is to determine the need for your product. Research the number of people in the market and the demand for your product.
For instance, if you sell a product for landscapers, find out how many landscapers there are and the percentage that would buy your product.
If you are starting a kratom business then you may face a little bit more challenge as it is not legal everywhere. You must know about the legal terms of kratom and where it can get delivered.
Then you should give your time to know which kratom products are popular which must be present at your store. Since kratom is a herbal supplement, you should know that it comes in the form of wholesale kratom powder and capsules and you can’t claim any health benefits while selling the products on your website.
So overall it depends on the product type also which differs from one business to another.
Research the competition. Learn how they position their products on the price/quality matrix and how they market the products.
Find out if the product you have in mind is a trend or a growing market. Google Trends is a helpful tool to use because you can see demand based on product searches.
If you look up the word “keto,” you’ll find that the search term trends higher around January, which is when people are looking to lose weight.
Get a sense of how many people are going to go online to buy your product vs. visit a brick-and-mortar store. Have a look at these eCommerce trends and what works for eCommerce retailers.
2. Determine the Fulfillment Model
You need to go through the steps to learn how you’ll produce the product, package it, and ship it to customers.
One option is to make the product yourself. This is fine for custom T-shirts, soaps, pottery, and other handmade crafts. The raw materials should be inexpensive, but you don’t want to compromise on quality, either.
Take into account the time and effort to produce the product. You want to make sure you’re able to price the product to make a profit on it.
You can hire a manufacturer like Supliful.com to produce the product, you can create your own brand, set profit margins, and upload the products to your online store.. This is a good option for eCommerce stores that plan to sell in large quantities out of the gate.
That’s because manufacturers require partners to guarantee a certain number of orders. It’s essential to ensure you can meet these numbers.
Buying products from wholesalers lets you purchase large quantities of a product at a discount. Retailers sell these products at a 50% or greater markup.
The issue you’d face with this model is inventory. You need the space to store excess inventory.
Dropshipping is a popular model for small eCommerce companies. You partner with a company that sells specific products, like mugs and t-shirts.
You can customize these products to fit your brand. Customers place orders on your site, and the orders get sent to the drop shipper. The drop shipper produces the order, packs it, and ships it to the customer.
3. Choose the Legal Structure and Business Name
Your business name has to reflect what you sell and for whom. It needs to be simple and catchy at the same time. It should also reflect your brand.
Remember, your brand is the feeling that people have when they think of your store. If you want people to feel rebellious and edgy, then have a name that matches that.
The business name has to be free, so research the name with your secretary of state’s office. Check the federal copyright and trademark databases, too.
You don’t want to invest money in a store only to discover that you have to change the name because of a trademark infringement.
The legal structure of the business you choose has financial and tax implications. You can be a sole-proprietor, LLC, partnership, or corporation. Consult with a business attorney to find out what the best option is for your business.
4. Build Your Online Store
You can finally build your eCommerce store! There are a few ways to build your eCommerce site. You can hire developers or DIY.
If you DIY, you can use a hosted solution like Squarespace or Wix. These sites are geared towards beginners, but they lack the flexibility to customize the sites.
A self-hosted site means you purchase a hosting plan and build the site using a content management system like WordPress.
As you build the site, always keep the user experience in mind. Make sure your site is fast and products are easy to find. You’ll end up with a higher conversion rate.
5. Market Your Business
There are dozens of ways to drive traffic to your site. You can rely on social media, blog posts, and SEO.
Think of your target market and use a couple of platforms that they use. You have to post consistently in order to gain traction online.
If you want to get sales immediately, invest in PPC ads. That gives you sales while the other marketing strategies build up.
Tips for Starting an Ecommerce Business
Did you learn what starting an eCommerce business really takes? It takes so much more than an idea. It takes research and planning to get it right.
You have to spend a lot of time learning about the competition, the eCommerce market, and product trends. Then you need to choose a model.
Only then are you able to build your eCommerce store and market it? The more frontend work you do, the easier it’ll be to find eCommerce success.
Are you ready for more startup ideas? Be sure to check out the blog.
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