From a translator: This translation is intended for those who are taking their first steps in the field of e-Commerce or are just thinking about starting a business in this area. Here, in fairly large strokes, it is outlined what to start with and what it is desirable to think about at the beginning of this long (and, of course, interesting) path. We decided to add several links to our articles and translations to the material – you can refer to them in order to study in more detail a number of issues raised in this topic.
Maybe recently you’ve already thought about starting an e-commerce business, like many others. This is not surprising given the 12% increase in sales in this area in the United States in 2013 alone. This means that the total revenue from such sales was about $ 296 billion. Incidentally, the e-commerce industry in India has also expanded by 30% compared to last year 2013. Now there the share of proceeds from e-commerce is $ 12.6 billion.
You can read about what features characterize American e-commerce in our post “What Russian e-Commerce can learn from American”
Looking at the numbers listed above, you might think that the industry is too big for you to make any sense of this type of activity, but this is simply not true. In fact, it will be easier for you to open your own business and start selling goods, precisely because this market is so large. Yes, there is competition here, but there are also a huge number of shoppers browsing the offered products in online stores with a wallet at hand.
This article will show you how to start an e-commerce business from scratch by building a solid foundation so that your business grows and develops properly. We will not delve into more complex processes such as sales organization and logistics, because they are not the main issues at the start.
Beginning of work
E-commerce is one of those types of business in which it is easiest to start a business, since you will not encounter any special obstacles here. You don’t need a lot of capital, you don’t need a $ 10,000 website, you don’t need to spend $ 4,000 each month on non-production costs, and you don’t even need to have a warehouse. We will discuss the topic of the warehouse in more detail a little later.
Of course, the tips below are quite universal, but if you are interested in the regional features of e-commerce, we advise you to refer to our publication “7 Success Factors of an Online Store in Runet”.
The first thing you need to do is define your e-commerce goals: do you want to open a kind of “shopping mall” and sell whatever you can reach? Or would you rather create a specialty store, focusing on meeting the specific needs of the community by selling your products?
Shopping malls are more likely to succeed when trading on a large scale, and there is a constant risk of failure if you don’t have a lot of capital to invest, resources to do good market research, and the like. Also, in this case, it takes much longer to purchase a large assortment of goods from reliable suppliers.
The best option for you at the very beginning is to choose a specific specialization, or niche, in other words. This is a small area of the market in which you will strive to take the leading position as an expert in this area. Examples include: riding equipment, scooter equipment, original motorcycle helmets, T-shirt prints, or toys for children ages 3 to 6. By choosing a niche, you significantly increase the chance of success, and also greatly simplify the search for suppliers, sales and logistics management.
You will need to find reliable suppliers in order to trade quality goods. Look for suppliers in your industry and research what they offer. If you are purchasing from another country, you should review the import regulations and import duty system. If you do not want to maintain too many storage facilities, then a direct delivery system is also suitable for you, in which you, in essence, buy goods from a supplier only when a customer places an order with you. Thus, the lack of risk makes this option quite suitable for you in the early stages.
You can read about how we ourselves created and optimized our warehouses here: 1, 2. And about what to do if the goods selected by the buyer are not in stock (with examples), we told here.
So, after you have decided what you want to sell, the next step is to think about where to sell. Don’t worry too much about this, as e-commerce is a big industry today and there are dozens of places to sell where you can list your items even with a limited or no budget!