Introduction
Buying online is fast becoming the preferred mode of shopping for consumers everywhere. Shopping online is quick, convenient and allows for easy price comparison. The growth in this industry has attracted entrepreneurs from all fields to the realm of online retail. This is no surprise, an online store can be opened for a fraction of the price of a brick and motor establishment and once setup can be considerably easier to run.
What experience is required, if any?
You don’t need any specific qualifications to be an online retailer. Initially you’ll be responsible for ever facet of your store including uploading products, handling sales and marketing. Any experience in sales and or marketing is helpful.
Web design and development skills aren’t necessary to open a store, although any experience is helpful. If you can use an online email account, operate a digital camera and make your way around a Play Station menu you’ll be able to run an online store.
Choosing an idea
Choosing what type of store to start is an important first step. A natural choice is to choose an industry you already have experience or connections in. No matter what you choose it’s recommended that you thoroughly research and plan your entry, compiling a traditional business plan is recommended.
Testing the waters with a pay per click (PPC) campaign is an excellent way to determine market demand and advertising competition. To setup an effective test campaign using Google Adwords or Yahoo Overture, pick a representative sample of products your store might sell. Setup a campaign to run over a week and test various different ads at different times of the day. To keep within Google and Yahoo’s terms of service agreement you might have to setup a one page site, sign up to an affiliate program that sells the products you’re testing – just in case someone does decide to buy.
Finally consider the supply side of your new idea. Getting accounts with suppliers as a new store can be very tricky. Some suppliers are also hesitant to supply to online only stores. Find out who the major suppliers are in your area and make contact with them before making a final decision on your new store. Find out which suppliers deliver and whether you have to meet a monthly order minimum.
Getting the ball rolling
Before setting up your online retail store you’ll need an office to run your business from. Ensure you have enough space to handle plenty of orders. Since you’ll be online for much of your work day, a powerful computer and a high speed internet connection is essential. Although your store is likely to be automated you’ll still be spending plenty of time on the phone, invest in a headset and consider a VOIP (Voice Over IP) service such as Vonage if you live in the U.S.
There are numerous online retail options to consider. Do extensive research into each and choose the one that best suits your budget, business goals and skill set.
On a shoestring with skills
If you are a web developer or designer and are familiar with XHTML, CSS and PHP you might consider building your own website and using an open source shopping cart program such as osCommerce or its offshoots Zen Cart and CRE Loaded. This is the serious shoe string route and has its downsides, browse the forum posts on the os commerce site and decide if you’re up for the challenge.
On a shoestring without skills
If however you are like the rest of us, without programming skills you’ll need to take a different route. Hiring a web developer to build you a complete store can be very expensive – but it doesn’t have to be. Consider buying a ready made store such as those found at e commerce templates.com. These stores are basic template websites with a shopping cart already build in. If you have a basic understanding of html you can customize it site yourself, alternatively hire a freelancer from a service such as Elance to do it for you. Using this method you could start an online retail store for less than $500 (USD), including a domain name and hosting.
Not on a shoestring
If start-up capital isn’t a problem life is certainly much easier. Do research on shopping cart software using a site like Shopping Cart Reviews.com. Once you’ve purchased a cart program hire a web design firm to develop a front end for your store and integrate it into the cart. This approach can often work out much cheaper than hiring a development firm to build an entire ecommerce site.
Key to success
Keeping large amounts of stock is costly and adds to your businesses risk. Start out carrying no stock and operating on a pure JIT (Just in Time) system – it raises your transport costs but is necessary. Once you’ve gauged popular demand keep a small stock of regularly sold items.
Gauge your websites efficiency and trustworthiness by the amount of automated transactions is processes. Initially when your website’s trust factor is low you’ll have to manually process the majority of orders and deal with clients directly. Enhance your stores credibility by purchasing a security certificate from Thwarte or through your hosing company.
Marketing
There are many ways to market an online store, the most effective of which is Google Adwords or Yahoo Overture. These pay per click (PPC) services make up the bulk of most online retail stores marketing campaigns. If you’ve never run a PPC campaign before it’s a good idea to buy a book and learn about PPC before starting your store – having read countless PPC books I recommend Perry Marshall.
Final word
A badly maintained store can quickly turn browsers away. Keep your stock up to date as new products are released and prices change. Monitor sales figures and adapt your product range to sales trends.