With every passing day, the number of online buyers is increasing continually, which is making more business to transform into eCommerce ventures. The digital era is welcoming the conventional as well as new business concepts to have online startups.

For some, it is easier to take the plunge, whereas, for others, it is a nightmare. To help you easily plan your journey to become a web entrepreneur, here I am sharing the important things to consider before starting an eCommerce business.

1. Select products after extensive research

Choosing a product or service to offer on your eCommerce website is the biggest challenge. We often copy the complete business model of an online business when we come to know that they are earning a lot by selling a certain set of products.

It is a viable strategy as long as a few stores are dealing in similar products. However, as soon as more stores join the bandwagon, your store may face tough competition. It may make you close the eCommerce business or move on to another niche. Therefore, it is mandatory to think twice before you decide to offer the products or services online.

Do your market research. Visit local markets to view what is available and what is not. Look into different industries where the existing product or service quality needs an innovative solution. Try to be creative in deciding over a product that is not replaceable in the same form so that your target audience remains glued to your eCommerce business for the near future. 

2. Define your target audience

Defining your target audience also involves understanding the region where you would like to operate. Without a proper understanding of who your target audience is, you will not be able to use the right kind of communication and platforms to get in touch with them. Such important details form part of what leading mentor programs like the Ecom Warrior Academy teach to budding entrepreneurs.

Decide the product or service, and find the target audience around it. Get to know their behavior as to how do they buy. Do they use mobile devices or still habitual to browse on personal computers. Know their cultural preferences and geographical differences to better cater to their needs.

Knowing your audience may help you devise an effective strategy for your eCommerce business else, you may be offering products along with discounts without any fruitful results. For example, you can choose women of ages above 30 years of the local town to reach them with attractive cultural attire. 

3. Speculate your sales figure

Product selection is half of the game. The real thing to consider is the volume of sales. On one side, a cheap product with higher sales may give you more profits than an expensive item with lesser conversions. Evaluate your product or service to assign budgets accordingly and expect realistic profit margins.

Deciding the sales figure of a local eCommerce business locally is easier, but it becomes challenging when you think of expanding to other territories. You can run multiple checks along with competitor’s analysis to find how much money they have injected into their business and their return on investment. With this, you will be able to plan finances and expect to earn that initially covers the costs.

4. Price your Products

Product pricing is also tricky in the eCommerce business. A product or service can be priced in line you are your business strategy. For example, you can setup monthly subscription charges for digital products such as web applications or magazines. The subscription-based model also works well for products that consumer orders frequently such as skin and beauty care products or grocery items.

You may often consumer either to set a product price above, below or equal to your competitor. However, this is malpractice. Evaluate your product independently and know the price your potential consumers are willing to pay. For example, if you are selling highly customized shirts, your customers may pay twice the price of a simple shirt that is available on every random store. Work on improving your catalog quality and it may compel you to construct more consumer-centered pricing strategies. 

5. Do a rigorous analysis of your competitors

Competitors’ analysis is as important as deciding over the products or services for your eCommerce business. It is a significant factor in product-selection as entering a competitive market requires you to offer outstanding quality, lowest rates, and an impeccable marketing strategy.

Despite this all, you may also need to come up with an innovative solution that is not available in the market. It is the competitors’ analysis that helps you take firm decisions. Therefore, develop your business strategy only if you know what the competitors have in store for the target audience so that you can formulate a different way to approach them.

6. Plan your inventory

For selling digital products, you need neither a warehouse nor an inventory management system in place. However, if you are selling physical products, you may need to plan to manufacture, ordering, and holding the inventory.

To effectively manage inventory, you may need to use different web applications that are compatible with the eCommerce platform you aim to use. It happens most of the time that companies buy a desktop solution for inventory management and when they aim to go online, they are unable to carry forward the data.

A small eCommerce startup may not initially need a dedicated warehouse as their sales volume may not permit it. Whereas, they can share a warehouse or hold the stock in their garage or a dormant room, and move to a dedicated facility as the sales grow.

7. Allowing order tracking

Your eCommerce business can allow tracking orders until it is in your hands. Tracking it in the transit depends on your courier company. Check if they offer order tracking or not. If yes, you may need to find either you can configure their order tracking in your web portal or not.

8. Engage with reliable shipping partners

Every shipping service provider has terms, conditions, and territory to cover. Collaborate with the local courier services for cheap and fast deliveries, whereas engaging reliable companies for international consignments. It may not only help you in routine business operations but also in pandemics like COVID-19. You may need commercial fulfilment services to streamline your product fulfilment and logistics.

In a situation of strict lockdown, when everyone is advised to stay home, a few courier companies are making the eCommerce operations possible. If such a widespread disease, your eCommerce business must be capable of serving your customers else if it may badly affect your sales and goodwill. Learn How COVID-19 is Affecting E-commerce to take preventive measures for making your online business a success.

Final words

It takes a whole lot of effort to plan and launch an eCommerce business. Every step takes great care. Missing any of it or committing mistakes can be devastating. Plan ahead of any misfortune by taking care of the above factors and keep your online business on a safe side.