Starting your very own business has never been easier today, thanks to the Internet. There’s no need to take out big loans, find investors, look for prime real estate, or hire a lot of employees when you can set up an online store that you can run by yourself with a minimal hosting fee.
Another advantage to running a business on the web is that you have
Take these following 5 factors into consideration so that you make informed decisions on what you can sell and how you’ll stock your inventory.
#1. Target audience
Arguably the most important factor that will decide what products you’ll be selling and how you will stock them is your audience. You need to know how big of a market it is to know how much demand you will be facing. If you’re looking to sell to a market with trending products that get sold out quickly, you will probably want to be able to meet the demand by contacting a wholesaler or distributor. If you’re going to cater to a more niche audience with a lower demand, you can settle and ship orders yourself.
With how fast the online retail industry is growing, it’s hard to find a market where you won’t find any sort of competition. In order to make your particular business stand out amongst the rest selling similar products, you need to have a good idea of the competitive scene.
It starts with knowing who your actual competitors are, as there are businesses aligned in the same industry as yours but aren’t offering the same things you are. It’s much easier to scope out the competition online since you can just visit their websites to see their catalogue, their prices, their customer relationships, etc.
Remember that your competitors aren’t just on the Internet. You should take into account local businesses because you might just get looked over if what you’re selling can be purchased 10 minutes away from your potential customers’ houses.
#3. Product expenses
Although it’s generally cheaper to start an online store than it is to run a brick-and-mortar one, there is still no avoiding the expenses of stocking an inventory, even if it’s a virtual one. The costs will depend on what kind of products you want to offer. If it’s going to be handcrafted items, then storage, labor (if you aren’t the sole creator) as well as the supplies you’ll need to produce them should all be accounted for.
You also have to consider the size, weight, and fragility of your product. Big bulky objects will require a warehouse for storage and shipping fees will be much higher, so drop shipping is a better product sourcing option. Perishability is yet another factor in product expenses when selling food and drinks. Preparation, handling, and expiration dates all contribute to higher costs.
Factoring in everything should have you still making a profit in the end to make the investment worth it.
#4. Product offerings
Chances are you won’t just be selling one or two items on your online store, as you would like to maximize your profits and take advantage of the virtually limitless space for Internet inventory. Even so, the time and money you free yourself from not having to stock all products in a physical space yourself will then be put in constructing your website’s architecture so that customers can navigate through it effortlessly.
You should also consider all the possible alternative options for the products you’re selling such as quantity, sizes, color, discount packages, etc. Giving your customers a choice makes for a better user experience, and you have to be prepared to accommodate these variations.
#5. Your own interest
As much as you’d like to see your business as simply a means of making you rich, it never hurts to choose products to offer based on how much you actually care for them. Having genuine interest in what you’re selling will drive you to promote it with sincerity, offer the best quality, and have the passion and insight to adjust your business to stay competitive in the long run.
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