Coronavirus has impacted our lives in so many ways, but it seems the long-term repercussions are only just starting to come to roost. The immediate physical dangers of the virus are well-known. Still, the pandemic has also rocked global economies, with many people now fearful of losing their jobs over the coming months.
In May 2020, there were 30 million registered unemployed in the US alone. That figure is expected to triple or even quadruple before the year is out.
To make matters worse, the recovery packages suggested by most nations fall well short of being able to offer employment to all those unfortunate enough to have lost their professions. In many cases, the jobs simply don’t exist anymore. For many furloughed staff, there is no work to go back to.
While the idea of starting up a business on your own might seem slightly daunting, it may provide your best prospect for getting back to work as nations around the world struggle to recover from the far-ranging economic effects of the virus. In particular, the growth of small businesses and e-commerce over recent years has been huge, and sales online are now predicted to overtake those of the High Street by as early as 2023.
But how do you go about starting an e-commerce business – and how do you increase your chances of success? Here are just a few pointers that could help you on your way.
Choose your market and identify a niche
The first and most fundamentally important aspect of starting a business is to identify your market and, ideally, find a niche. With so many stores competing online already, it will help your cause greatly if you can find a crucial niche area in which to operate.
There’s an adage which states, “Stick to what you know” – and you won’t find sounder advice when it comes to starting your own business. Go with things you enjoy, that you’re knowledgeable about and have an enthusiasm for. If you enjoy what you do, you’re far more likely to stick at it.
Select the best model for your business
Your choice of market will undoubtedly influence the best model for your business and how you intend to sell to your clients. The most obvious business models are service industries, product sales, subscriptions, and online digital sales. However, these are just the tip of the iceberg in terms of how your company could operate.
For example, if you want to be truly proactive and streamlined in your sales, you may opt not to stock products and instead entrust your whole product inventory and delivery network to an Order Fulfilment Company.
Alternatively, you may see opportunities in offering branded items – in which case white label services might be the best route to go, where you entrust branding and production to another company.
For digital sales, you may not even need to stock any product (e.g., software, music, games, etc.), in which case your sales could be done almost entirely online with minimal overheads.
Identify who you’re selling to – and how you’re going to sell to them
It’s tempting at the start of any business to try and appeal to as many different people as possible – to take a “Jack of all trades, master of none approach” – however tempting as this may be, it will be ultimately death detrimental to your company and its operations. You cannot be all things to all people.
Rather than trying to take an all-encompassing approach, look instead for specialist markets inside larger industries.
Remember, people searching online are often looking for specific products not generally available from the larger stores. You are far more likely to have success in these smaller markets than if you try to take on the more significant, established companies. Try to drill down into product sectors and find your specialist area.
For example, if you are starting a shoe shop, it might be tempting just to offer every shoe type available – for man, woman, or child. Against the likes of Amazon, what chance do you stand? It’s unlikely you’re going to have any success going against the more prominent players already in the market when you’re just starting.
Instead, a better idea is to concentrate on a specific niche within that market, e.g., rather than just shoes, go for sports shoes – or perhaps look at specializing even further, i.e., specialist trail-running shoes. By drilling down into specialist areas, your chances of success become considerably higher.
Allocate a marketing budget
Operating online, your primary method of driving clients to your website (and therefore making a sale), will be through online advertising and marketing. Yes, real-world promotions still have their place; however, the internet is global and represents a far-greater potential market.
Online marketing is a considerable area, worthy of an article in its own right however as a base, you need to be looking at search engine optimization (SEO), social media promotions, regularly updating your website and possibly looking at online pay-per-click (PPC) advertising. To do this right, you should consider enlisting the services of a professional marketing agency to look after all aspects of your online marketing.
Write a business plan
Once you’ve identified all the above, you’ll be in a much better position to write a business plan. While this might seem a little redundant considering the work you’ve already done, don’t omit this stage as it will provide the route path for everything you do subsequently to develop your business.
A well-written business plan should also include a SWOT analysis (identifying Strengths, Weaknesses, Opportunities, and Threats). Actually, on writing your business plan and doing a SWOT analysis, you may well identify other areas where you can improve your overall business model.
Choose and trademark a name
Choosing a name for your company is essential in any business – but probably even more so when it comes to online companies.
Your company name will likely also become your domain name (i.e., the URL/internet address people use to visit your site), so it should be short and memorable. Check online with naming authorities for availability.
Create your online store
With e-commerce, your store is your greatest asset. After all, you don’t have a brick and mortar shop to rely on, so it’s essential your store looks good and works well.
There is a huge range of budget e-commerce platforms available, which may be enough in the short-term to get you started. However, given the importance of your online shop to your entire business, you should also look at bringing in professional help as soon as possible.
Have a long-term growth plan
It’s difficult to think long-term when you’re first starting, but there’s no harm in giving yourself some direction to work to. Opportunities will present themselves along the way that you perhaps didn’t think of, but having a general idea of where you want to take the company and how you want it to progress is a great way to keep yourself on track.