Is eCommerce a fit for your business?
Before you set up your eCommerce store, ask yourself whether your business is suited to it.
Most businesses will benefit from an online presence, but they do not necessarily need an eCommerce solution. In many cases, a suitable online presence can simply be an informative website.
Answering these questions should help you decide whether an eCommerce solution is right for your business.
1) Have you prepared a business plan?
This is the first step in any new business venture, and will help you answer several of the other questions.
2) Do you have suitable products to sell?
Certain products are ideally suited to an eCommerce strategy, including:
- Hard-to-find products, including collectibles and specialist products not readily available from high-street stores
- Downloadable products such as software, music, and publications
- IT products including computers, printers and peripherals
- Specialist products such as food, cosmetics and over-the-counter pharmaceuticals
- Combinations of goods that are usually bought together, such as office supplies or groceries
Products with a high transport cost as a proportion of the total price are unlikely to be suitable, especially if they are readily available from local retail outlets.
3) Is there a good supply chain, and a ready demand for these products?
If you can't get products quickly, you won't be able to fulfil customer orders on time. This will give your online shop a poor reputation. When there is no market or limited demand, your then eCommerce might not be the best option for you.
4) How easy is it to package and deliver the product, and how much will it cost?
Remember to either factor in your time, or the cost of using a fulfilment company. What will the impact be on the competitiveness of the venture?
5) Do you have the resources and skills to get an eCommerce business up and running?
What are the gaps in your knowledge and experience and how easily can you fill them? Do you know anyone who can join you in the business who has the necessary abilities?
Remember that you'll need to assign budget to pay for the eCommerce website design, the initial stock of products, and to promote your online shopping site. You will also need time to devote to site maintenance, fulfilling orders, dealing with suppliers, and responding to customer queries.