How would you like to make $100’s or $1,000’s of extra income each month with your own eCommerce website? It’s completely possible and there’s numerous people doing it every day.
With online retail sales increasing year after year, now is the best time to start your own eCommerce website. Online retail sales increased roughly 15.7% in 2014 when compared to the previous year while total retail sales only grew by 4.4%. What does this mean? More and more people are purchasing from their home or mobile device instead of driving to the store.
Starting an eCommerce website might sound like a huge undertaking, but it’s not as hard as you may think. In this article I’ll shine some light on the steps necessary to start your own eCommerce website this week and give you the tools you need to get started. All you need is dedication, perseverance, and the willingness to learn.
Step 1 - Choosing an Industry and Product
For some, this is the hardest step of the process and can cause a lot of headaches. Choosing the right product to sell online can have a huge impact on whether or not your eCommerce website is successful. But with millions of different products available, how do you know which ones to sell?
Here are a few things to consider when choosing an industry and product.
Price
How much does the product cost? If it’s too low it will be challenging to reach a positive ROI. If it’s too high ($1,000+) there’s a good chance customers will want to speak with someone over the phone or through live chat prior to purchasing. This additional customer support requires added time and money but can pay for itself 10 times over. Many have found the $100 to $200 price range to be the sweet spot for online sales since the majority of people are comfortable placing an online order in this range.
Margin
What’s your cut on every sale? Many products sold online have a margin around 30-35% however this can change drastically depending on the industry. For example, electronics typically have thinner margins while phone accessories are often marked up 200%+. Before settling on a product, make sure you know the margins. Often times this requires contacting the manufacturer directly or signing up with a distributor (more on this in step 2).
Local Availability
Can you buy this product locally? Generally speaking it’s easier to drive sales online when the product can’t be bought in local stores. Why? Simple, if they can’t get it locally then they must go online to purchase. This is one of the reasons I recently launched a website that sells 3D printers online since 3D printers haven’t quite made their way to brick and mortar stores.
Shipping Size
How big (and heavy) is the product? Bigger and heavier products tend to have high shipping costs which can negatively affect sales. Most customers not only want free shipping, they expect it. For this reason it can be difficult to sell a product with a hefty shipping fee. Many online retailers combat this by including the cost of shipping into the price tag while raising the price and offering “free shipping.” However, these increases in price can decrease sales. Look for products that are smaller and don’t require expensive shipping costs.
Passion
How interested are you in this industry? This last one is often overlooked but is usually a strong indicator of success. Starting and growing an eCommerce website typically comes with a series of obstacles and frustrations. Passion for your industry can be a great source of motivation to push through challenges that arise. What are your hobbies? What do you enjoy doing for fun? You like gardening? Great! Look into starting an eCommerce website that sells gardening equipment and planters.
Step 2 - Finding Manufactures with Great Products
Now that you’ve identified which products you want to sell it’s time to find out who the manufactures are. There are a few different methods of finding manufacturers that can save a lot of time.
Google Shopping
Google Shopping is a powerful search engine that only searches physical products sold online. It also has some great information on who the re-sellers are (great for scoping out competition) but more importantly who the suppliers are. Simply enter your product into Google Shopping and pay attention to which manufacturers show up under the “Brand” section.
Directories
There are many online directories of suppliers that make it easy to find manufacturers. Some directories are better than others, but there are two that are worth looking into.
- Worldwide Brands – Thousands of wholesalers and over 10 million products ($299 membership fee)
- Wholesale Central – 1,400 supplies and over 700,000 products (Free)
Once you’ve built a list of manufactures the next step is to start reaching out in hopes of reselling their products. Not all manufacturers will want to work with someone who is just starting out since they don’t have any track record of sales. Start with the manufacturers and distributors who have the least intimidating application and requirements. Many larger manufacturers will want to know who you’re working with first, so leverage the relationships of smaller suppliers to get larger suppliers on board.
Note: Many manufacturers will ask for a Tax ID number or Resale Certificate number. Check with your local city and state to learn what licenses and permits you need to sell tangible goods.
Step 3 – Setting up the Website
So you’ve chosen your products and found a few manufacturers to work with, what next? Get the website up and running.
Now some people reading this might wonder why anyone would contact manufactures before even having a website. The reason being is that it’s more difficult to get manufactures on board when the website is empty with no products versus having a website launch in the future. That said, it can still be a good idea to create a simple “Coming Soon” page.
Choosing an eCommerce Platform (aka “eCommerce Cart”)
The eCommerce platform manages all the products, categories, checkout process, and other aspects involved with a functional eCommerce website. There are dozens of eCommerce platforms available, most of which have relatively the same functionality and features. Choosing a platform can be a big hang up for a lot of entrepreneurs. I recommend taking the “Ready, Fire, Aim” mindset and just get something up and running now rather than spending hours and hours researching and testing various platforms.
I’ve worked with many different eCommerce platforms over the years and have found two that are both powerful as well as extremely easy to use.
- Shopify (Starting at $14/mo) – Shopify has done everything they can to make setting up and running an eCommerce website as easy as possible. They handle all the hosting, security, and credit card processing to give store owners more time to focus on promoting their website. However this also means that webmasters are somewhat limited when it comes to changing how the website functions and looks. To combat this, Shopify has a wide range of website templates and apps. While there are free apps available, many have an associated monthly fee which can add up quickly.
- OpenCart (Free) – OpenCart is a very powerful and easy to use platform with a long list of features. Unlike Shopify, OpenCart is open source meaning webmasters have the ability to make any changes to the design or functionality of the website. However, this also means that hosting and website security will need to be setup manually. OpenCart also has thousands of pre-programmed “extensions” that allow users to easily customize the website without hiring a developer. Many extensions are free of charge while others have a one-time fee between $10 and $50.
Bottom line: If you want to get started as quickly and easily as possible, choose Shopify. However if you’re somewhat technical and want more control over the look and functionality of the website, choose OpenCart. Again, you can always move to another eCommerce platform down the road if necessary.
Domain Name and Hosting
If you’re using Shopify or any other hosted eCommerce platform, you can skip this section. For those who plan to use OpenCart or another open source platform, read on.
Every website needs a domain name for their brand and server for hosting. However, eCommerce websites also need what’s called an SSL (secure sockets layer) Certificate to encrypt sensitive data such as credit card numbers and personal information. To make the process of getting a domain name, hosting account, and SSL Certificate as easy as possible I recommend using BlueHost.
BlueHost is a very popular and affordable web hosting company that also registers domain names. They have amazing customer support which makes it a great choice for beginners. For eCommerce websites, it’s generally a good idea to go with their Business Pro hosting account for higher performance as well as the much needed SSL certificate for added security. They also have a powerful and easy to use dashboard that even allows users to install OpenCart, or another eCommerce platform, with one click.
Logos and Web Design
A website’s design and branding can have a huge impact on how often website visitors purchase. Hiring a designer and having a website custom designed can cost $1,000’s or even $10,000’s. If you want to minimize start-up costs there are a few solutions to ensure a good looking website without breaking the bank.
- Purchase a Website Template – Online marketplaces such as ThemeForest offer thousands of different templates (aka “themes”) for websites. They also have themes specific to both OpenCart, Shopify, as well as a number of other eCommerce platforms. Many of these themes are beautifully designed and mobile friendly. They usually only cost $20-$50 which is a fraction of what it would cost to pay a designer. Best of all, these themes typically have built in customization options which make it easy customize the website the way you want.
- Get a Logo for Cheap – A logo is an important component for any branding and marketing efforts. Again, hiring a professional graphic designer is likely not the cheapest route. Instead, take a look at 99Designs ($299+) and 19 Dollar Logos ($19+). 99Designs is a crowd sourced design platform where dozens of designers submit their logo design and only the one you like best gets paid. The quality is great especially when you provide detailed instructions on what you’re looking for. 19 Dollar Logos on the other hand is much cheaper but only has a few concepts and revisions. Don’t be fooled by the price tag and ugly website, these guys do great work for $19. The quality isn’t nearly as good as 99Designs but it’s a strong solution for those on a budget.
So what’s next? It’s time to take action and put what you learned into practice. Equipped with this new information and drive for success, you have everything you need to start your very own eCommerce website. Remember, every year the web gets more and more competitive. Now is the best time to get started and enter the world of eCommerce.