The 5 Steps Before You Build an Online Store
So you want to start an online store! That is great. The online store eliminates rent to pay on a storefront as well as reach millions of customers from really the comfort of your own home if you want too. To begin with you will need a great product, concept to fulfill a need in a specific market, a user-friendly website, and a rock solid marketing plan. Read on to learn how to get started.
Decide what you want to sell. This is the beginning but you probably already have an idea for a great product or a series of products to sell. You need to keep in mind that certain things are conducive to selling online. No matter what, you should believe passionately in the value of your product, services, download, etc. – otherwise, it will be hard to connect with customers. Here are some questions to consider:
Is it a physical product that needs to be shipped, or is it a digital product that can be sent or downloaded through the Internet?
Are you going to have to stock inventory (more than one) of each product, or will they be one-of-a-kind (e.g. artwork, vintage items)?
Are you creating the product yourself? Make plans that you are able to keep up with demand. Make sure you have a reliable supplier.
Are you going to want to sell a wide variety of products, or do you plan to specialize, like selling just t-shirts or books?
If you don’t plan to make the product yourself, you’ll need a good manufacturer. Research different companies to find the one that is ideally local and works for your business idea.
Decide how your product(s) will be shipped. Shipping can be a hassle so be sure and create a plan to ship the product from your home efficiently, or work out a storage and shipping plan with a warehouse. Ideally sell a product you can drop-ship, especially if the product is being manufactured by a third party.
Find a niche. Knowing what product you want to sell is only part of creating a successful online store. You’ll need to figure out what differentiates your services from all the other similar products/services people can choose, both in person or online. Why should a customer buy your hand-knit sweaters when they have 100 other online shops to choose from?
Size up the competition. Don’t just jump into selling a certain product line until you’ve looked at the websites you’ll be competing with. Consider the main online marketplaces you plan to advertise your products; and check out the competition within those portals.
Offer something truly original. Try to strike a balance between something that is highly original and also has general appeal.
Offer expertise. Perhaps the quality that sets your company apart from the rest will be your expertise on the type of product you are selling. Maybe you’re a former baseball pro selling a line of baseball gloves, for example. Make your passion and expert knowledge part of the package.
Offer a user-friendly purchasing process. Even if your product is very similar to other things for sale online, you can set your store apart by making the shopping experience fun and easy. Make sure your website is easy to navigate and fun to share. Be responsive and provide great customer service where others don’t.
Test the waters by selling your items on a small scale. In the real world, it’d be wise to try selling your products through other, low-commitment avenues (consignment, flea markets, etc.) before taking the plunge and starting an entire store. The same is true for selling online. Try selling your items individually on eBay, Craigslist, and the like. Here’s what you’ll want to look for:
Who is buying your product? Offer a discount coupon or free gift if they answer a brief survey. Find out where else they shop online.
How much are they willing to pay? Experiment with different prices.
How is customer satisfaction? This is a good time to test how well you can get your product to the customer. Are you using good packaging? Is the shipping method reliable? Are they happy with their product? Did you describe it well?
Complete a Business Plan. Before you start the process of opening your online store, take the time to draw up a detailed business plan, even if you are not planning on getting outside funding from investors. It will help you plan the steps you’ll need to take to make your business becomes successful. Be sure and figure out your cost of operations and map out a detailed marketing strategy. You’ll want to take these factors into account:
- Production costs, whether you’re creating your product yourself or contracting with a manufacturer.
- Shipping costs.
- Taxes.
- Employee wages, if applicable.
- Fees for reserving your domain name and web hosting service.
Register your business according to your state’s laws. When you’re ready to make things official, you’ll need to come up with a business name and fill out the necessary legal and tax paperwork to register your business.
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