For some of us, the thought of being successful in selling a product online sounds far-fetched. But we still desire to work from home, take midweek trips, and become the bosses of our own lives. Does that sound like you?
There are many ways to make money online, and e-commerce is one of the simplest online businesses to start. You can easily gather a few extra bucks for your pocket’s sake by using it as a side hustle. Once you get your first dollar with online sales, making more of it becomes a routine.
The e-commerce industry has over 2 billion online shoppers from all around the world. With the upward trend in the digital buyers’ population, anyone can slip in some product and reap a portion of the profits. You just need an Internet connection!
What If I Don’t Have a Product?
Although most profits come from owning a product, you don’t need one to make a killing. The idea of selling things one doesn’t own has been with us since time immemorial. I bet you know a broker or two in your neighborhood.
In e-commerce, you can remotely sell the products of other people. This is where dropshipping comes in. As a dropshipping agent, you connect customers and retailers with suppliers or manufacturers to earn commissions.
What do I Need to Know?
Knowing whether or not selling products online is the right fit for you is a necessary thing to consider. It determines how far you’ll go with the online business. Let’s explore the pros and cons of an e-commerce business to ease your decision-making process.
The pros of selling products online
The reasons why you need to start building your e-commerce empire include the following:
- You work from home under your own schedule. There is no need to travel to work and come up with excuses after being late. You can choose to roll over your bed or lay in your backyard as you watch sales coming in.
- You get a chance at following your passion. No more going to meetings to discuss something that doesn’t even interest you. Assuming you’re a heavy coffee drinker, you can start an online store for selling branded coffee mugs and apparel. Sorry, did you say you admire something else? That sells too!
- Ecommerce is less risky than the traditional type of selling. You don’t need to deal with high startup costs for your business. A physical place isn’t required to set up your store. The thought of thieves breaking in to mess you up won’t cross your mind!
- There are no opening and closing hours. Buyers can access your store at any time of the day. This flexibility allows you to maximize your sales.
- It’s easy to reach new customers online. International buyers can purchase your product with little effort. If you introduce a new product, your store’s visitors will know about it in no time.
The cons of selling products online
There are several downsides of e-commerce business, as listed below:
- It can take some time to see results. Going a month or two without making any sales online happens more than you may think. This lack of buyers occurs when you are just beginning as few buyers know about you.
- Learning is an endless process in e-commerce too. Understanding your customers and your selling platform is necessary before you ever earn a tidy sum. You can’t wake up to $1000 in sales without a killer marketing strategy.
- There is some work in generating passive income. Selling online means that you’ll have to promote your products, initiate shipping, and provide customer support. You’ll have to do all of that by yourself until you’re established enough to hire a team.
Selling a product online isn’t one of the ways to get rich quickly. But the efforts you put in can help you build a significant amount of wealth in the long run.
Top 3 Business Models of Ecommerce
If you want to stand out from the competition in e-commerce, you should understand your market, create a solid plan, and work out a business model that fits your ideas. Keep in mind that your budget plays a huge role in your choice of an e-commerce business model. Let’s take a look at the 3 e-commerce business models topping the industry.
Dropshipping is a low-risk e-commerce business model that saves you from the huge startup costs of starting a store. It’s all about reselling a product on your online store or a different marketplace from where you found it. If you have a tight budget or just don’t want to invest a bunch of money as a beginner, dropshipping is for you. You only spend money after a sale comes in.
This model doesn’t require you to order large quantities of an item in advance. You also don’t need a warehouse or physical shop to stock your goods before selling them. You simply sell someone else’s product without interacting with it.
The first thing to do in dropshipping is finding a manufacturer or seller with a significant supply of the product you’re looking to sell online. The supplier should have a good number of positive reviews from customers. If they have a considerable amount of sales, it means that the product appeals to many people.
Once you add the product to your online store, customers can buy it (at retail price) using PayPal or a card. After receiving the payment, you place an order with your supplier (at wholesale price) and get the product shipped to your customer’s address. This way, the product goes directly to the buyer as you pocket the profit from the sale.
Sourcing goods for online reselling
Sourcing and reselling is a popular method in the brick and mortar type of business. It works the same way in the e-commerce business. You either source items directly from a manufacturer or use a wholesaler.
Here, you need a considerable amount of cash to buy in bulk. Most wholesalers give you the best prices if you order large quantities of their products. The higher your investment, the more profits you get when reselling your stock.
Manufacturers differ from wholesalers in that the former can create a personalized product and even put labels to it. Because of all the designing, testing, and shipping of samples, developing your own product comes with its set of hoops.
After getting the items shipped to you, put them into storage, and list them online for sale. You should have a proper packaging and delivery strategy to keep your customers buying more. Set up a timeline during which returns are acceptable.
Your negotiation skills play a significant role in getting the lowest possible prices from both wholesalers and manufacturers. If you go to one supplier over and over again, there are high chances that they’ll offer you a cut-price benefit. So, be sure to praise your supplier from the start to establish a good relationship.
Selling your own creations
If you are creative enough, you can try your hand at making your own items for online selling. Printables, crotchet items, wood carvings, and pencil drawings are a few artistic products that people love to buy. You only have to find the right market for whatever you want to sell.
Start by creating only a few pieces of your desired product to test the waters. Ask for the views of your family and friends regarding your creations. If a good portion of the feedback is positive, put your first set of products into the market.
The next thing is to study the demand curve for your new product. Be sure to keep your prices close to that of sellers in your niche. Only scale up when the number of potential buyers increases.
When your business takes off, set up a distribution method that reaches as many customers as possible. Also, a marketing plan is essential if you’re looking to stand out among your competitors.
5 Simple Steps to Sell a Product Online
Online selling can be challenging at first. But it becomes a fun process as soon as you get the hang of it. Are you ready to start your own e-commerce business? Here are the steps to start selling online today:
Step 1: Choose Your Product
If you are dead set on selling online, you must have a product in mind by now. But remember that some products sell better than others. And you’re only here to hit the jackpot without a disturbing amount of trial and error attempts.
So, how do you find that high-selling product? Here are things to consider:
The first thing to look at is the profit margin. Customers should have the will to buy the product at your price. For instance, consider if you can get sales with an online retail price that triples the product’s wholesale or original cost.
With a unique product, people can give you a significant amount of money to lay their hands on it. Uniqueness comes from scarcity. This means that your product should be one not easily found at local stores or thrift shops.
Your next move is to check the product’s demand. You don’t want to fill some warehouse with products people can’t buy. When it comes to dropshipping, a low-demand product may be good for adding credibility to your online store. People trust stores with a good number of items on sale. But that should only come after you’ve added several in-demand products.
Lastly, check the number of competitors you’ll have. If there are numerous sellers of a particular product, it can be difficult to stand out without pouring a few too many dollars into marketing. As a beginner, you may be on a budget with only so much to spend on ads.
A product backed with some market research is profitable. Don’t mind if it’s an item that aligns with your interests or something you recently discovered online. Go ahead and choose it!
Step 2: Determine your suppliers.
Now that you have your chosen product, you need to identify one or two reliable suppliers. A supplier in an e-commerce business is equivalent to a business partner. You should be wise in your decision here.
Here is how to find a supplier for dropshipping.
Search engines are useful for comparing different suppliers of your desired product. Google is the best for doing a general search. You’ll see a list of potential suppliers on several different marketplaces. To make your work simple, use any of the following sites:
This free platform has millions of products from China’s suppliers. You only have to search for a product and choose a supplier while paying attention to the number of orders and reputation. Go for the ones with over 100 orders and positive reviews close to half that number. Their ratings should be something over 4.5 stars out of 5.
The SaleHoo directory contains over 8000 approved wholesale suppliers and over 2.5 million products. The site’s Market Research Labs ease your search for profitable items to sell online. You get all that for $67 per year.
Doba enables dropshipping agents to find niche-specific products and export them to an e-commerce platform. You buy the product from Doba after someone places an order in your online store. It gets shipped directly to your customer. Doba members pay a monthly subscription fee starting from $29.
Here is how to find suppliers for the other e-commerce business models.
If you plan to source items and put them into storage, Alibaba is the perfect option. Aside from wholesalers, you can find manufacturers on the platform. Some tips for finding reliable Alibaba suppliers are:
- They should comply with Alibaba’s Trade Assurance. In case your products are faulty or delay to arrive, this service covers you. You can easily claim a refund.
- They should have the Gold membership. This membership, which costs $10,000, gives the supplier privileges such as exposure and enhanced ROI.
- They should fall under the category of assessed suppliers. Nothing is more credible than a supplier with verified products and assessment reports.
- They should have over 3 years of using Alibaba. An experienced supplier with a good reputation offers way better service than a new one.
By following the tips above, you avoid scams and poor customer services. Combine the first 3 supplier qualities by checking off their respective buttons on Alibaba. This approach filters off all the other suppliers that lack such qualities.
After you find your supplier, contact them for negotiations. You should communicate in a determined, polite, and clear way. Also, check if the supplier’s response is legitimate, friendly, and timely. Using a phone call instead of emails can help build a better relationship with your supplier.
In your negotiations, be sure to act like an established business. Order the items in bulk. Avoid intermediaries by only going after manufacturers. All these actions help you get the best of prices.
Step 3: Choose your selling platform.
The Internet has numerous e-commerce platforms where sellers can upload their products for sale. Some are region-specific, while others ship products worldwide.
A good e-commerce platform should have many customers, low competition per niche, and affordable seller fees. All these aspects contribute to the maximization of profits when your business takes off.
Marketplaces that operate regionally are the best for selling warehouse or local-based products. You only have to choose a company that operates within your area. Go to Google and type something like “Online seller registration + your location” in the search bar to find local e-commerce platforms.
Dropshipping gives you more flexible options for selling products online. You only initiate payments while your supplier ships the product to your customer. Both individual online stores and international marketplaces work well with dropshipping.
Here are the top platforms to sell your products online.
Amazon is the best platform to list your products to millions of online buyers. It allows you to sell products sourced from local and online retail stores, wholesale suppliers, or private label manufacturers. The marketplace also has strict requirements when it comes to registering new sellers. Read the Amazon beginner’s guide to get more details regarding the sign-up process.
eBay is an Amazon alternative with less strict seller requirements. But there’s a limit to the number of products you can sell as a new member. This restriction maintains the platform’s trustworthiness. After creating an account as a seller, choose a payment method, and then list your product.
Your own online store
Setting up an e-commerce website gives you more freedom on how to run your business. You also benefit from the lack of competition and seller fees. The best approach is to integrate Shopify on your site. An alternative is to set up a site using WordPress and then add e-commerce plugins such as WooCommerce, BigCommerce, or Cart66 Cloud.
Other platforms for selling online include Etsy, Craigslist, and Facebook Marketplace.
Step 4: Start your e-commerce business.
With all the integral bits at hand, it’s now time to build the whole thing. Your business must have a name that is not only catchy but also acts as a brief description of what it’s all about.
Naming your online store
Currently, it’s quite hard to find unused single names. Your next option is to play with two or three words while keeping the whole name short.
For instance, you can name your online store Brewed Treats if it deals with products related to coffee. Another example is Feline Gift Shop for a store selling cat-related items.
Once you find a name that embraces your niche, perform a domain search to check its availability. You should be consistent in naming all the social pages of your e-commerce business.
For an e-commerce business, legal formalities vary from one state to another. You’re likely to forget about this step since your business isn’t based in a physical place. You should check your region’s policies to ensure you remain on the safe side of the law.
In some cases, the products you intend to sell determine whether or not you need a business license. Examples of these are ingestible products like food, drugs, and supplements. Weapons also fall here.
You may need a seller’s permit to collect sales tax from your end customers. This documentation also depends on your location. Check with the online sellers near you if you’re unsure of where to look.
Note: The above information largely applies to dropshipping stores. As for online marketplaces, you may only need to create a store name, and you’re good to go.
Qualities of a good e-commerce business
A good e-commerce business should have:
- High-quality product photos that appeal to customers’ eyes.
- Good sales copies that describe all products in detail.
- An attractive theme for online stores since it influences the purchasing decisions of customers.
Step 5: Market your product online.
It’s time to let people know about your product. The more the efforts you put into marketing, the more sales you’ll get. The only obstacle to it is identifying the marketing strategy that works for your e-commerce business.
How can I promote a new product online for free?
While it’s true that paid adverts are effective for increasing product sales, they aren’t the only option. As a new seller who is trying to avoid risks or has a limited budget, you may not want to start with ads. There are several free ways to attract customers online.
Your e-commerce business should have a presence on various social platforms. Customers on Facebook, Instagram, Twitter, and Pinterest won’t hesitate to take a look at what you’re selling. Even when they barely need your product, convincing them enough may lead them to buy it for some friend or family member. They might share it on their pages as well if they know someone who needs it.
Starting a blog that is related to your product by niche is powerful for building awareness. Your product should come off naturally in your blog posts. For instance, you can include a self-help book on sale somewhere under the blog topic, “How to become the best version of yourself.” If you need an article that is all about your product, write a review.
YouTube is a free platform to sell products to your viewers. All you do is mention the item in a video, put a link to it in the description section, or do both. You can also dedicate a YouTube channel to reviewing your products.
What are the paid ways of marketing products online?
Paying for promotions is suitable for reaching targeted audiences. Many “big” online sellers and dropshipping agents use paid ads to keep their businesses at the top. The good thing is that the costs are flexible. If possible, combine it with the organic ways of getting sales to maximize your income.
Facebook is the top social platform where paid ads are popular. The advancement in its marketing plans allows you to target customers using factors like age, interests, and location. An ad budget of $10 per day can bring you dozens of sales daily if you target the right audience. You only scale up when you find a high-performing ad.
Exporting your Facebook ad to Instagram helps you get the most out of your marketing efforts. This is possible because Facebook owns Instagram. Using a business account, each post you make on Instagram is eligible for ad creation. Another top way to boost sales on Instagram is by paying influencers to promote your product.
Why not use the most popular search engine to promote your online store and products? Google ads can position your website at the top of search results for niche-specific topics. Your ad can also be shown in blogs through Google AdSense. The average cost lies between $1 and $2 for each ad click. Youtube ads, running on a site owned by Google, are also essential for promoting products using video and other interactive media.
3 Tips to Improve Your Ecommerce Business
Let’s now look at how you can become a better seller online.
Provide fast shipping
If you sell your own products, be sure to ship them to customers in good time. In dropshipping, only choose suppliers with a good reputation when it comes to shipping. This includes looking at the shipping company the supplier uses for the supported countries.
Offer high-quality customer support.
You must have heard the phrase, “The customer is always right.” Your customers should be your priority. If a buyer has issues with your product, professionally resolve the matter. Respond to their queries humbly and conclusively.
Ask for feedback from customers.
Encourage your customers to review and rate your product after purchase. If the feedback is positive, thank them for it. If it’s negative, let them give you their reasons and improve on the mentioned areas.
Be open to the latest trends in e-commerce at all times so that you stay ahead in the competition. New themes, plug-ins, and marketing strategies appear on the Internet from time to time. Adopt any ideas that are proven to help your e-commerce business grow.