Ecommerce is a different kind of animal than a simple blog. It’s a mix of the traditional retail store with the access and technological advantages of the internet. One affect that the internet brings is that it gives everyone the ability to start their own business with a very low start up cost. Anyone with a product to sell can open a store on the internet for less than $10 a month for hosting.
That is a low barrier of entry! (Buying and creating inventory will increase the upfront costs, but I’ll discuss that below)
So, this month, my wife and I have started on a new adventure in the area of Ecommerce. It took a little bit of planning and some footwork, but yesterday we were able to launch her new online store to sell animal beanie hats!
You can see that we are still in the beginning stages of the website, but we’ve got the inventory, store, and payment and shipping system worked out.
Behind the Scenes of Ecommerce
In the beginning, ecommerce is not much different than starting a regular retail store. First off, you have to find something to sell. In our case, our 3 year old son gave us a great idea with his love of animals.
Finding something to sell for your ecommerce store is similar to finding a niche for your blog. It’s finding the idea behind your store.
The first thing to decide is whether you want to sell a physical product or a digital product. A digital product saves you the trouble of shipping and handling, but you generally have to create the product yourself or outsource its creation. The other downside is that I think it’s a bit harder to gain credibility with a digital product because it’s harder for your audience to visualize the product.
A physical product, on the other hand, you can show pictures and describe in detail. You can give your audience a really clear picture of the size, texture and look of the product really easily with a few snapshots. Also, I think this is the more traditional retail route, so there is a level of comfort when someone purchase an actual physical product. However, you have to deal with shipping and handling as well as storing the product. The other downside is that it may increase your starting costs as you have to purchase inventory.
Ecommerce with a Physical Product
Today, I’ll focus more of the logistics of the commerce with a physical product.
Figuring out what you are going to sell is the very first step towards opening a store. If you already have a physical store and just want to expand your shop online, then this part is easy. You already have inventory. But what if you are the aspiring entrepreneur? If you don’t have an inventory to sell, then you have to figure this part out.
My first suggestion is to find a product with a personal connection for you. This will make it much easier to sustain the passion for your retail store. Also, you are putting your name and reputation behind the product, so you want to start off from a place of credibility. Find a product that you really love so you can feel satisfied selling it to others.
Ecommerce Create Your Brand
Once you figure out what you are going to sell, you want to create your brand. This is an important first step because you are going to be creating your online presence with your brand.
At this point, you want to name your store as well as create your logo.
Naming your store sounds easy, but it does take a little bit of creativity. You want to find the right balance between creating a unique name, but also one that is catchy and easy to remember. You may want to use your name or a reference to your name as a part of your brand as well. Also, you’ll want to check and make sure that your name is also available as a .com domain.
If you can, you want to plug a keyword into your name as well, but this isn’t as important as creating something memorable and catchy.
After you’ve picke a name for your store, you want to create a logo as well. You can hire a graphic designer to help you create a logo, but if you have an idea of what you want your logo to look like, you can find a great deal for creating your logo on fiverr.
My wife was able to have someone create an awesome logo for her on fiverr for only $5.
She was able to do this because she figured out her inventory already and had a name for her store: Hetty Hats. This way, she was able to ask the person to create a cartoon like image to symbolize her hats, with the name of the store.
Now you’re ready to get your inventory.
Getting Your Ecommerce Inventory
This requires a bit of footwork. But if you put in the research and work, you will get the best wholesale deal for your product. This will make a huge difference in your profit margins.
Start with figuring out who manufactures your product. You can check the product labels or do an internet search for your product. I recommend searching the internet as that will give you a large variety of manufacturers to choose from. Once you figure out who manufactures your product, you can simply contact the manufacturer with an inquiry. Don’t shy away from contacting international manufacturers, as you’ll find that they often speak your language (in our case English) well enough to conduct business.
In our case, my wife introduced herself in a short email, with an inquiry to the manufacturer about bulk pricing for the animal beanie caps. This started her off with a round of negotiating to get the best price. Let them know that you want to purchase in bulk and don’t be afraid to suggest a discount for a bulk price. This negotiation process can go back and forth for several days or even weeks if you are emailing across time zones. Don’t worry, it’s all part of the process.
One thing that you can also negotiate is for the manufacturer to help you personalize your product with your logo. This is one reason why I suggest creating your store name and logo prior to ordering your inventory. In our case, my wife was able to get the manufacturer to sew in her logo into the clothing label of the hat.
How cool is that!
Now you know that this isn’t just any old animal beanie cap. It’s a Hetty Hats animal beanie cap!
Once you hammered out pricing, you also need to figure out how you are going to handle payment. This can be a bit nerve-wracking as you are discussing sending several thousand dollars to some stranger you met on the internet. But there are ways to protect yourself. You can suggest paypal, which does provide invoicing services and buyer protection. There are service fees with large money transfers, so be prepared to pay those fees. Paypal is a little more expensive than western union, but you can always switch to a cheaper method after you’ve had a successful transaction.
Also, your negotiation process should have built up some rapport with the person, so you can feel more assured when you send them money.
Now, one thing to keep in mind is your space situation. If you are starting out opening up a brand new store, chances are you don’t have a huge warehouse to store all this inventory. Keep that in mind when you are negotiating your bulk purchase. How many of your items can you comfortably store in your house. Balance that with keeping a reasonable inventory in stock for your sales.
In our case, since these hats are small in size, we were able to comfortably order several hundred to keep in stock. They take up several storage boxes in our house, but nothing we can’t handle.
Once you have your inventory, you are ready to get started selling online as well as offline if you choose.
In my next segment, I’ll discuss how we went about setting up our website and getting ready to sell.
There are some things you can do to ease the payment process for your buyers and keep things simple for yourself. So keep an eye out for the next article about our ecommerce adventure!