Indy
07-28-2005, 09:47 AM
I've been dabbling around in e-commerce for about three years now, and in that time, I've learned a lot of lessons--some of them the hard way. With a kid, it's tough to stay on top of everything. For me, the key is doing as much as I can from home. Quite frankly, it's a hassle to time errands when a toddler's not tired, hungry, or out-right cranky. Add an arm-full of packages and you can imagine the fun of keeping a kid out of trouble.
1. Get The Essential Equipment
You can't build a business without the right tools. Over time, I've found there are several items that make working at home MUCH easier. First and foremost is my Dymo Label Printer. These label printers are worth their weight in gold and make label sheets a thing of the past. The labels come in a roll, reducing clutter and drastically cutting back on wasted material. I use my label printer for everything from mailing labels to inventory control. The Dymo software also lets you convert your customer database into mailing labels--great for direct mailings.
There are two other printers that share space with my Dymo--my UPS label printer and my B&W laser printer. The UPS printer can be leased from UPS for $2 a week. Considering UPS provides the labels for free, it's a great bargain. The printer integrates with UPS's web site, making label printing seamless.
The B&W laser printer is a great way to keep costs down. Take it from someone who worked for Xerox for 7 years--inkjet printers are EXPENSIVE once you figure in the cost of ink, especially if all the colors are in the same cartridge. The price on B&W printers has come down drastically, and can be had for a couple hundred bucks.
Finally, there's my Pitney Bowes postage meter. Not so much a necessity, as a convenience, the meter comes in handy when I'm shipping internationally, or sending out a lot of mailers. You can get one through your local office supply superstore. Keep in mind that federal laws prohibit owning one, so you'll be leasing it from Pitney Bowes. At $20 a month, it's a great alternative to driving to the post office every time you have something oddball to send through the mail.
A few other items that I've found handy, but not 100% necessary are a wireless laptop, thumb drive, and cell phone.
2. Use These Web Sites
http://www.usps.com
http://www.fedex.com
http://www.ups.com
http://www.paypal.com
You've probably heard countless experts say that as a society, we're changing the way we do business and the fact is, they're right. More people are buying online, and to succeed, you must offer the services your customers want. From what I've seen, they want fast service and easy payment systems.
Be prepared to provide shipping options from multiple providers. Otherwise, you'll lose out on sales from people who've had bad experiences with one company or another. Personally, I like using the post office. Their low prices allow me to offer free shipping, and they're well integrated with PayPal. They even offer free shipping supplies (such as boxes and envelopes) to boot! UPS and Fedex also offer a variety of free shipping supplies.
PayPal has become the most popular form of virtual currency. An Ebay company, PayPal allows you to accept all major credit cards, as well as e-checks. As long as you pay close attention to their shipping and chargeback policies, you'll do well. As I mentioned, they've integrated their system with the US Post Office, making shipping an easy affair. By using the PayPal shipping system, tracking numbers are automatically logged and forwarded to your customer, boosting your level of customer service, while reducing your workload at the same time. To make things even easier, load up your laser printer with labels from http://www.labeluniverse.com (Part number LUCLICKSLW10).
3. Organize, Organize, Organize
Take it from somebody who's ADD and a clutter magnet, keep yourself organized. If you have the space, convert a room in your garage, basement, or house into your office. The space must be large enough and flexible enough to function as an office, shipping department, and warehouse. If the bulk of your storage is going to be in a room other than where your computer is, try to keep a small inventory of your products in your office. I went to Lowes and bought some cheap storage cabinets (you can find them in the closet organizer section) and lined my office walls with them. For cheap tops, I bought 8 ft shelving pieces and butted them together. Some angle braces and straps keep the top joined to the cabinets. Of course, I also attached some child safety latches that required no tools to open. :) As most of my products are small in size, I also use a lot of plastic compartment boxes to keep everything better organized. http://stdindustry.com/pics/IMG_0289.jpg
4. Cater To Customers The Others Don't
More than 50% of my sales have been through credit cards by phone and to international customers. In fact, I was the only person doing it for a product that netted $200 per unit!. In three months, I became my suppliers biggest distributor.
Don't be afraid to offer products to customers from other companies. I've sold product to customers on six continents and NEVER had a problem. A bit of advise though, only ship by Fedex. They have lower agent fees (a fee paid by your customer) and they provide door-to-door tracking to most countries.
5. Offer Products In A Way That Others Don't
The main product that I sold was an item that was typically customized by customers. I identified the most popular upgrades, and offered them on my site. If the customer purchased everything from me, I'd install the upgrades for free. I also offered a package price that included a selection of upgrades, again installed. My margin on the upgrades was thin, but it was an effective way of getting around the suppliers' MAP (Minimium Advertised Price) restrictions. 95% of my customers purchased the package rather than just the base model.
6. Sell Only What You Have In-Stock
While drop shipping or a Just-In-Time inventory practice, may seem like a cheap way to get started, try to avoid it, or wean your company off it as quickly as possible. This is a lesson I learned the hard way. Delays in shipping and stock shortages can bring your company to its knees. I wound up using a modified JIT inventory practice. I figured out what my suppliers' average ship times were and tripled that number. Then I went through my sales figures and determined how much inventory I needed to last that long. As I sold items, I put a significant portion of the profits back into more inventory or new products.
7. Advertising
E-commerce is appealing because you can open your doors to the entire world. But you have to keep in mind that it works both ways--you're also competing with the entire world. So how do you compete? In my opinion, there are three ways to succeed in E-commerce--be the cheapest, be the most effective advertiser, or offer something the others don't.
Regardless of which route you choose, be sure to advertise in some form or another. If your product is related to a hobby, look for online forums that appeal to that hobby. Get their ad-sheet if they have one, or speak with the web administrator about advertising your product on their site (Whatever you do, don't just go out there spamming message boards). Find members who are respected and active in the forum and give them free samples of your product (or loan it to them for review). Make your advertising dollar stretch by targeting your customers.
8. Beware The Bargain Hunter
Something I learned early on (even before I began selling online) was to beware the bargain hunter. Bargain hunters are only loyal to the lowest price and they'll bail the minute somebody comes out with a similar product that's pennies cheaper. Your time is better spent with customers who will return because of the service.
1. Get The Essential Equipment
You can't build a business without the right tools. Over time, I've found there are several items that make working at home MUCH easier. First and foremost is my Dymo Label Printer. These label printers are worth their weight in gold and make label sheets a thing of the past. The labels come in a roll, reducing clutter and drastically cutting back on wasted material. I use my label printer for everything from mailing labels to inventory control. The Dymo software also lets you convert your customer database into mailing labels--great for direct mailings.
There are two other printers that share space with my Dymo--my UPS label printer and my B&W laser printer. The UPS printer can be leased from UPS for $2 a week. Considering UPS provides the labels for free, it's a great bargain. The printer integrates with UPS's web site, making label printing seamless.
The B&W laser printer is a great way to keep costs down. Take it from someone who worked for Xerox for 7 years--inkjet printers are EXPENSIVE once you figure in the cost of ink, especially if all the colors are in the same cartridge. The price on B&W printers has come down drastically, and can be had for a couple hundred bucks.
Finally, there's my Pitney Bowes postage meter. Not so much a necessity, as a convenience, the meter comes in handy when I'm shipping internationally, or sending out a lot of mailers. You can get one through your local office supply superstore. Keep in mind that federal laws prohibit owning one, so you'll be leasing it from Pitney Bowes. At $20 a month, it's a great alternative to driving to the post office every time you have something oddball to send through the mail.
A few other items that I've found handy, but not 100% necessary are a wireless laptop, thumb drive, and cell phone.
2. Use These Web Sites
http://www.usps.com
http://www.fedex.com
http://www.ups.com
http://www.paypal.com
You've probably heard countless experts say that as a society, we're changing the way we do business and the fact is, they're right. More people are buying online, and to succeed, you must offer the services your customers want. From what I've seen, they want fast service and easy payment systems.
Be prepared to provide shipping options from multiple providers. Otherwise, you'll lose out on sales from people who've had bad experiences with one company or another. Personally, I like using the post office. Their low prices allow me to offer free shipping, and they're well integrated with PayPal. They even offer free shipping supplies (such as boxes and envelopes) to boot! UPS and Fedex also offer a variety of free shipping supplies.
PayPal has become the most popular form of virtual currency. An Ebay company, PayPal allows you to accept all major credit cards, as well as e-checks. As long as you pay close attention to their shipping and chargeback policies, you'll do well. As I mentioned, they've integrated their system with the US Post Office, making shipping an easy affair. By using the PayPal shipping system, tracking numbers are automatically logged and forwarded to your customer, boosting your level of customer service, while reducing your workload at the same time. To make things even easier, load up your laser printer with labels from http://www.labeluniverse.com (Part number LUCLICKSLW10).
3. Organize, Organize, Organize
Take it from somebody who's ADD and a clutter magnet, keep yourself organized. If you have the space, convert a room in your garage, basement, or house into your office. The space must be large enough and flexible enough to function as an office, shipping department, and warehouse. If the bulk of your storage is going to be in a room other than where your computer is, try to keep a small inventory of your products in your office. I went to Lowes and bought some cheap storage cabinets (you can find them in the closet organizer section) and lined my office walls with them. For cheap tops, I bought 8 ft shelving pieces and butted them together. Some angle braces and straps keep the top joined to the cabinets. Of course, I also attached some child safety latches that required no tools to open. :) As most of my products are small in size, I also use a lot of plastic compartment boxes to keep everything better organized. http://stdindustry.com/pics/IMG_0289.jpg
4. Cater To Customers The Others Don't
More than 50% of my sales have been through credit cards by phone and to international customers. In fact, I was the only person doing it for a product that netted $200 per unit!. In three months, I became my suppliers biggest distributor.
Don't be afraid to offer products to customers from other companies. I've sold product to customers on six continents and NEVER had a problem. A bit of advise though, only ship by Fedex. They have lower agent fees (a fee paid by your customer) and they provide door-to-door tracking to most countries.
5. Offer Products In A Way That Others Don't
The main product that I sold was an item that was typically customized by customers. I identified the most popular upgrades, and offered them on my site. If the customer purchased everything from me, I'd install the upgrades for free. I also offered a package price that included a selection of upgrades, again installed. My margin on the upgrades was thin, but it was an effective way of getting around the suppliers' MAP (Minimium Advertised Price) restrictions. 95% of my customers purchased the package rather than just the base model.
6. Sell Only What You Have In-Stock
While drop shipping or a Just-In-Time inventory practice, may seem like a cheap way to get started, try to avoid it, or wean your company off it as quickly as possible. This is a lesson I learned the hard way. Delays in shipping and stock shortages can bring your company to its knees. I wound up using a modified JIT inventory practice. I figured out what my suppliers' average ship times were and tripled that number. Then I went through my sales figures and determined how much inventory I needed to last that long. As I sold items, I put a significant portion of the profits back into more inventory or new products.
7. Advertising
E-commerce is appealing because you can open your doors to the entire world. But you have to keep in mind that it works both ways--you're also competing with the entire world. So how do you compete? In my opinion, there are three ways to succeed in E-commerce--be the cheapest, be the most effective advertiser, or offer something the others don't.
Regardless of which route you choose, be sure to advertise in some form or another. If your product is related to a hobby, look for online forums that appeal to that hobby. Get their ad-sheet if they have one, or speak with the web administrator about advertising your product on their site (Whatever you do, don't just go out there spamming message boards). Find members who are respected and active in the forum and give them free samples of your product (or loan it to them for review). Make your advertising dollar stretch by targeting your customers.
8. Beware The Bargain Hunter
Something I learned early on (even before I began selling online) was to beware the bargain hunter. Bargain hunters are only loyal to the lowest price and they'll bail the minute somebody comes out with a similar product that's pennies cheaper. Your time is better spent with customers who will return because of the service.