Many people have already created a successful business by selling goods online that they purchase in bulk. If you have a store idea, you can research related products and wholesalers, comparing the prices and demand. However, not all online retail ventures are successful. Most people jump head first and don’t think their business model through well enough to succeed. Learn more about the most common mistakes to avoid when creating an online retail business.
- Not Researching the Competition
Before you start up an online retail venture, you will need to check out what other options your future customers have, and how you can offer better value. Creating an online business is not different from having a physical store. You will have to come up with a business plan that is built on research and industry intelligence. If you are planning on selling the same items others have on different sites cheaper, you will not make any money, unless you offer added value.
- Choosing the Wrong Suppliers
While dropshipping might be a good online store startup option, it also has its disadvantages. You will not know the people delivering your items to your customers, and cannot check that the packaging is suitable for your brand. Make sure that you check out your suppliers and dropshipping companies, check their reviews, and reputation. You don’t want to make the wrong impression when just entering a new market.
- Bad Pricing Strategy
You will have to create a pricing structure that works well for you and your customers as well. You might want to offer discounts on large orders, or free shipping over a certain amount spent. No matter which option you choose, your pricing needs to be appealing to customers and profitable for your business. You also have to keep an eye on the pricing structure of your competition, and offer more value through added services, for example gift packaging or delivery time slots.
- Not Calculating Shipping and Storage Costs
Many people don’t think their pricing through carefully enough and lose money by charging too little for shipping. Your best chance of getting your costs and profit margins right is to get quotes from different postal and delivery companies. If you buy items in bulk, you also have to calculate the cost of delivery and storage. You can find out about the prices of warehousing and storage by visiting Canning Vale Storage Units. Get your expenses accurately accounted for, so you don’t end up losing money.
- Lack of a Marketing Plan
Just like with every business, you need to have a plan for communicating your offer to your target market. You can create a marketing plan using an online template or simply brainstorm every night and put a schedule together, listing the cost of promotion for each method. This way, you can start getting customers faster and earning money.
Whether you are thinking about selling goods on eBay, Etsy, or on your own website, you should think it through carefully. Have a business plan, budget, and marketing plan, calculate the cost of shipping and storage, so you can make your online venture a success and avoid failure.