The figures all tell the same story: e-commerce is on the rise, has been for some time, and seems set to continue rising. What was once a novelty has become commonplace, and the system of selling products online has long since been democratised to the point where just about anyone can pull it off, earning incomes in the hundreds, then thousands, and well beyond.
As the popularity of e-commerce for buyers and sellers alike only grows, it is a simple fact that now is the best time to do it. But how much technical know-how does one need to set up an e-commerce site? What are the potential pitfalls and how best can one avoid them? And as an essential first investment for anybody wishing to begin selling stuff online, what is the best way to economise on costs without cutting back on the quality and reach of your site?
Creating an e-commerce site is, ultimately, a simple process and it can be adequately summed up in a few important steps. However, there are certain things that potential online sellers might not have realised before beginning and a few issues that may trip you up. Some elements of the e-commerce process are fundamental and therefore common to all platforms regardless of what is being sold. Yet there are still more that are very much dependent on what it is you want to sell and how you want to sell it. Read on then for a complete guide to your first e-commerce site. All that’s required is a modicum of patience and a willingness to learn.
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Decide on Your Product and Industry
What do you want to sell? This is the one factor that will affect everything you do afterwards and so it’s important to get it out of the way from the start. With e-commerce websites, there is rarely a one-size fit all website mould that can be adapted to anything you want to sell. This is not to say, of course, that every single product needs a distinct selling platform and that you cannot sell a diverse range of products on the one site, but the type of product you want to sell can certainly be grouped into a broader category (or an “industry”). Deciding on what industry you want to work within will decide much, so it’s best to identify it right away.
Not all products or industries will perform as well in an e-commerce setting (and some are significantly harder to market than others). For this reason, it is wise to choose carefully before you begin to build your e-commerce site. If you aren’t set on a particular product from the get-go, it’s worth considering a few things before you decide on one.
What is the price of your product by unit? If the price is too low, it can be pretty tricky to reach a discernible return on investment that will make your e-commerce venture worthwhile. This is for the simple reason that, while you may think you can always sell more of a product, a single sale normally equates to a single customer and if you need many more customers to see a decent ROI on a low-priced product, this is an added challenge for your business. Similarly, if your product price is too high, the customers typically feel less comfortable placing an order online and will look for some additional guarantee of expertise, such as a consultation or a phone chat. This will mean extra investment in customer service.
What is the margin on your product? This is one factor that can vary immensely between different products and industries. Some products, such as mobile phone accessories, can be marked up at around 200% while others are typically sold for much closer to their cost of manufacture. Generally, most products online are sold for a margin of around 30% to 35%. If you calculate your margin as much lower than this, it may not be worth the effort.
The availability and nature of your product also have a massive effect on whether or not it can be sold online with much success. Regarding local availability, there is a simple rule that dominates – if a product cannot be bought in local shops, then it has to be purchased online. Answering a demand like this is a fantastic way to give your e-commerce business the edge. But if your product cannot be easily purchased in local shops, then you’ll need to consider the shipping costs involved not only in acquiring it from your supplier but in getting it to your customer as well. Much of this is relatively straightforward – larger products cost more to ship and rarer/more valuable products cost more to acquire. All the same, this is something to consider before committing to a particular product.
Regulations and Legal Requirements
There are many rules and legal requirements that could apply to your e-commerce business, so one of the smartest things to do from the off is get acquainted with them. This will prevent any nasty surprises down the line. If your e-commerce site collects personal data on your customers, then you can expect stringent and heavy regulation on how to go about this. Most e-commerce sites have to comply with GDPR data protection policy, which involves the personal data submitted by your customers and can be fairly complicated. The best way to ensure everything stays above board is to hire an auditing service or perform a DPIA GDPR risk assessment to ensure that personal data collected from your customers is done so in a fully legal manner.
Setting Up the Website
A major rule when it comes to setting up the website for your e-commerce site may surprise you: contact the manufacturers and secure your supply first! You may wonder why anyone would secure a supply from manufacturers without even having a website, but the truth is that it is far more difficult to do so if you have an empty e-commerce site instead of the promise of a future launch. This is not to say that you cannot make a simple “coming soon” page, however.
When it comes to selecting your e-commerce platform, it is best to simply take the plunge with a platform that has been reasonably well-spoken. You will not know the finer details of your needs and requirements until you have been selling your product for a while. If at that point, it is clear that you need to change the platform then you can, all the while keeping the same branding and domain name to ensure you do not lose any regular customers.
Have a Passion
Ultimately, the best predictor for e-commerce success is to have a passion for the product and industry that you want to work with. If you know your product well, use it frequently in your daily life and have experience being the customer within that industry. Then your knowledge and enthusiasm should pull you through.