StoresOnline Helps You Find Answers About Online Business

There is so much information online about every possible subject and there are even more websites that will tell you what to do with your time, money, and life in general. We found a website that asked some very common questions about eCommerce and are happy to share the questions and answers with you:

Q: What are the first things to consider when starting up an online business?

A: Find a niche product line that sells well online. Without a niche product, you will have a difficult time seeing success on the Internet- no matter how elegant your store designs and layouts are. Be sure that the products you choose to sell can be sold online. In other words, if you sell an item that costs $10.00 and weighs 80 pounds, the low-value-to-high-weight ratio makes this item more difficult to sell.

Quality online products should have a high value-to-weight ratio (ie. a $30.00 item that weighs only 5 pounds). Conduct product research to find out how many others potentially compete with you and who they are. If you can offer store customers a better price or have the ability to innovate the way in which it’s sold, then you have successfully found a niche product line for yourself and should consider adding those items to your catalog.
Q: What is the biggest challenge in starting up a successful online business?

A: The most challenging aspect of starting and opening an online store is getting customers to know who you are, what you offer and where to find you. It is difficult to get customers to your store if they don’t know about it, you or your products. In other words, marketing is the most challenging part and takes the most time to perfect.

Even if you manage to build a great web store and sell a terrific product, it doesn’t guarantee people will find you online or buy any products unless they know your company name or domain location. Making your store visible to potential buyers means employing tactics that are proven to increase online visitors and conversions. Typically, a well planned search engine optimization and online marketing strategy will be enough to get your store in front of many potential customers looking for what you sell.

Q: What are the most common misconceptions about owning an eBusiness?

A: Most people think that by opening an eBusiness it will make them rich beyond their wildest dreams. Although online commerce can certainly be a profitable venture and has the potential to make you a good amount of money, it doesn’t necessarily mean that it will happen overnight or that certain traditional business and ethical rules don’t apply to online merchants or eRetailers.

Many online store owners have made an honest attempt to be successful at online commerce, yet have failed. Starting any new business, whether online or off, is a lot of work, and great success rarely happens overnight, but if you are patient, and hardworking, it is certainly possible to be a successful eBusiness owner.

Q: Should I buy inventory or use a drop ship supplier when first starting out?

A: When first starting out it is better to use a drop shipper or manufacturer who packages and ships the products for you. There are literally thousands of distributors who are eager for the opportunity to sell more of their products. Drop ship relationships have many advantages over stocking your own inventory. Stocking inventory and making it ready to ship is expensive. It requires upfront investments, a place to store shipments, inventory tracking, shipping labels and could even require extra employees that were not planned for in your eBusiness plan. Having a drop ship supplier take all these burdens and out-of-pocket costs out of your hands can save you time and money when first starting out. In addition, most good drop shippers will use your shipping labels or send the packages with no branding of their own so your customers will not know the difference.

The disadvantages of using a drop shipper are few, but there are some. With a drop ship supplier you can expect a lower profit margin and there may even be a small fee for each shipment. The other disadvantage is you are not running the customer service aspects all yourself and most small drop shippers do not have great customer service to provide. As you can imagine, stocking inventory would give you control over both of these disadvantages and may even provide a higher profit margin. Weigh out your options, look at the pros and cons of each and figure out which way works best for your eBusiness.

Q: Do I need a merchant account or can I just use Paypal and money orders?

A: Online shoppers today like to have choices when buying the things they like from web stores. Rather than limiting your customers to one choice when paying it is better to offer several ways for them to buy. For merchants who are just starting out it may be tempting to go with a free payment option like Paypal rather than investing to get a merchant credit card processing account. Before you decide, it’s best to consider what the fee structures of your options are like and how much per transaction they charge. It may cost more to get a merchant account up and running, but the process will be worth it in the long run as you will probably get more converting customers by offering options.

Having Paypal alone as a payment option has drawbacks that may be difficult to overcome. For instance, they reserve the right to freeze funds, so you may be without your money or unable to accept payments. Paypal doesn’t give you the ability to process orders off your web store. You may wish to manually collect payment information on some orders and you won’t be able to do that with Paypal. You may have to wait longer to get your funds deposited into your bank account. Although the process is easy, it may be a hassle for your customers to register with Paypal before ordering with you. It may also be difficult to setup recurring payments for your customers if that is a requirement with your eBusiness.

The only major drawback to merchants who are starting out with a merchant account may be the initial setup fees along with the recurring monthly fee. Some merchant account providers also require you to buy virtual processing software or a processing machine for your office.

There may be an initial limit on the amount of orders you can process in a month of the amount of money you can accept per month. These limits are typically present until the merchant account provider gets to know you and your business trends.

Some people love Paypal, some people hate it. When it’s all said and done you have decide what works best for your eBusiness. You may also wish to research Google Checkout as a merchant account provider.

Q: How has selling online changed since the Web first began?

A: Electronic commerce first began in the early 1990’s when the Internet first opened to commercial use. The concepts of buying and selling and business combined with computers and the Internet all contributed to the possiblility of eCommerce. Since then much has changed or evolved including the many branches or different forms of online commerce. The biggest change since merchants first began selling online is there wasn’t as much market saturation or competition and it wasn’t as difficult to obtain an easy to online brand or company identity. Now, in addition to the many small online businesses selling online we have large fortune 500 companies like eBay and Amazon to compete with.

The world of eCommerce wouldn’t have been possible without the advances in technology that are now familiar to all online merchants. The expansion of credit card companies, electronic payment gateways, online shopping carts and the places to market your items have all contributed to the growth and evolution of eCommerce. The need to have a secure place to enter payment information has led to new innovations in storefront security and privacy measures. With the development of the Web came more ways to build an online store and more options for store owners who are looking to design a custom shopping environment. Now we have online store builders and complex programs to automate many of the tasks needed during the design, security, marketing and maintenance stages.

Shopping online has also changed from the customer standpoint. Not only has the amount of people shopping online steadily increased so have the ways they shop and buy items of interest. The are more places to choose from with a greater selection of hard to find item and more ways to pay for them. The advances in security also help customers feel more secure when entering their personal information over the Web and buying items electronically. New and innovative things are happening all the time online, it’s no different in the world of eCommerce.

Q: How will selling online change in the future and how can I stay current?

A: One of the best ways to ensure success selling online is to be able to spot trends in the industry and guess where the market you sell in is headed in the future. As shopping online becomes more common and popular among the public, we will see more competition and rivalry and it may get harder to find unique items to sell or unique ways to market those items. Each year we see online sales increase and the number of purchases made are quickly becoming comparable to traditional brick and mortar sales transactions.

Many people like shopping online because it is more convenient and allows them more time to shop around, compare prices and read product reviews. As these trends evolve, we will continue to see enormous amounts of growth within the eBusiness industry. It will be imperative for brick and mortar merchant sellers to keep up with current changes or they may face having to shut down their storefront due to stiff competition online. Not only will brick and mortar merchants have to keep up to stay competitive, but so will online merchants. Store owners can stay current by listening to feedback from their customers and by keeping up with current design, product and marketing trends to attract new ones.

If you are looking for a way to start off with an online business, we recommend that you learn more about StoresOnline Express. If you have other questions or insightful comments about your experience with online business or starting an eCommerce storefront, let us know.