Depending on your goals and budget, there are a few ways to get started in entering the world of e-commerce and building an online store...
Option A: Online Vendor
When you're just starting out, one of the most affordable ways to get up and running is to create a store on an online shopping website such as Etsy or Ebay. It's free to sign up and you can sell to visitors who come to those sites and do searches; you can also sell to your own customers through these sites, via your online marketing or offline promotions such as coupons or business cards. [More: Hello crafty lady! How to turn your hobby into a business]
Pros:
- Free to get started
- Easy to use
- Can leverage some of these sites' traffic
Cons:
- You don't own the website so you can't sell it in the future
- Because they own everything, it is a bit harder to establish a competitive advantage
- Because they are paying to run the site, your cost per transaction is usually higher than it would be if you owned the website
Estimated cost:
- Free to set up, plus a few hundred dollars for marketing and promotions. [More: Trust your gut: Business lessons from Spanx founder Sara Blakely]
Option B: Hosted Online Store
If you want to own your own online store but you don't have thousands of dollars to build the site, you can start with a pay-by-month type system like Shopify, who will provide you with designs and all the tools you need to get started. You can put the website on your own domain name so that you own it and have control over it.
Pros:
- You will own the domain name, so you could sell the store in the future
- You can more easily do SEO (search engine optimization) and PPC ads to attract website traffic
- You can decide on the look and feel of your store by choosing from one of their templates
Cons:
- Since you are using their content management system, you will likely have to pay a monthly fee plus a percentage of your sales
- Again, since you are using their system, you are subject to their changes and updates
- If you decide you want to switch over to another content management system in the future, this could have a negative impact on your search engine rankings
Estimated cost:
- A few hundred dollars to start, plus ongoing resources needed to market your website to attract visitors [More: Raising capital: 4 things NOT to do (and one important secret)]
Option C: Fully Customized Website
This would involve hiring a local web design company to build you your own e-commerce store. The cost and time involved will really depend on the size and score of the site you want to build. Make sure you get your website built on a content management system that has e-commerce capabilities so you can easily add and edit products.
Pros:
- You own the website and ideally whatever content management system it is built on, so you have more control over the long-term
- You own your own domain name, so if you make the website a success you can sell it in the future
- You have full control over the look and feel and branding of the site
- You can get your website developer to add in integrations like social sharing and other promotions
Cons:
- It will cost a lot more to do this (both initially and ongoing)
- You will likely need a contract IT person to help you with any issues that may arise from running an e-commerce store
Estimated cost:
- A few thousand dollars to get set up (at the very least), plus your monthly marketing budget [More: 10 most valuable start-ups founded by women]
Whatever you decide, do your research and come up with a solid competitive advantage and marketing plan before you start spending money.
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Nothing contained herein is intended to provide personalized financial, legal or tax advice. Before implementing any financial or legal strategy, you should obtain information and advice from your financial, legal and/or tax advisers who are fully aware of your individual circumstances, as well as fully aware of current laws and regulations.
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