How To Know If You’re Ready To Manage An Online Store – It’s not for everyone
April 19th, 2008
You’re thinking of launching an online store to sell your products or services. You’re wondering if you’ve got what it takes to be successful in this rapidly changing online arena. You’re wondering how much time it will take and what it will cost. You’re wondering if you’re smart enough. This article hopes to help you answer some of these questions before you invest in an online store.
Developing and managing an online store is not a simple task, and one that small business owners should consider thoughtfully. Here are some of the questions you should ask yourself:
1. How Good Am I At Working With Computers and Navigating the Internet?
Online stores do not run themselves. They can save you and your staff a lot of time, but someone still needs to manage it. The more computer savvy you are, the easier it will be for you to understand and manage your online store. If the internet bewilders you, and you often find yourself unable to navigate around to where you want to go, or find yourself yelling at your computer often because you don’t understand what it’s doing, running an online store might be out of your reach.
2. How Often Do I Shop Online?
You should be very familiar with online ecommerce and shop frequently online. If you never or very rarely shop online because you are afraid to put your credit card at risk, or you are unwilling to do online banking for similar reasons, then running an online store is not for you. Why should your customers trust you if you don’t trust your own bank’s website? You should also be familiar with “good” and “bad” online shopping experiences – so you are able to put yourself in the shoes of your customers.
3. How Much Time Do I Have To Dedicate To My Online Store?
Developing an online store requires the active participation of store owners. They must have adequate time to spend learning how their store works, including how to add categories, products, product options, set appropriate shipping fees, taxes, discounts, and many other store-related features.
They must also have enough time to manage the store once it’s finished – they must respond quickly to new orders, ship items in a timely manner, uphold good return policies, just to name a few.
I had a prospective client phone me one day, looking to set up an online store for his girlfriend who was a flight attendant. When I asked why she wasn’t calling herself, he said it was because she was too busy and was often out of town. I asked him how she was going to manage running an online store if she was often out of town. Silence. I declined to accept him and his girlfriend as clients.
4. If Your Small Business Is Failing, An Online Store Probably Won’t Save You.
If you have a small business that is not currently doing well, launching an online store might not be able to save it. If your products are overpriced, if you aren’t good at managing your money, if your product quality is poor – these are all things that an online store can’t fix. It is not easy to get people to a) find your store and b) convert them to paying customers. If you’re thinking that launching an online store will save your small business – think again, there are no magic bullets here.
5. Can You Afford To Develop An Online Store?
Online stores are often large complex applications. Good online stores are not free. It also costs money to pay someone (like me) to install and configure an online store. Then there are fees for credit card processing and fees for SSL certificates, etc.
Unless you already have a pre-established website with lots of traffic, you will need to figure out how to get traffic to your store. You may have to invest in Search Engine Optimization or Pay-Per-Click advertising. You may have to purchase advertisements in magazines and other media formats.
If you aren’t able to spend at least $1000, then you might be better of trying out eBay as a medium to sell your products.
6. Can You Take or Obtain Professional Grade Images Of Your Products?
I added this to my list because this really trips up some folks. You will need images of what you’re trying to sell. High quality professional looking images. You will need to be able to manipulate these images yourself – adjusting quality, resizing, etc. If you can’t do this, you should learn how to do it before attempting to launch an online store.
7. Can You or Have You Run An eBay Store? Before you spend thousands of dollars developing an online store – perhaps you should try selling your products on eBay. It’s free, and will give you a bunch of experience regarding online commerce and what kinds of skills are required to sell your wares on the internet. If you don’t have the amount of computer skills necessary to run an eBay store, then a “real” online store isn’t going to be a possibility.
Nervous?
Now, don’t get me wrong, I’m not trying to talk you out of developing an online store. I really enjoy helping my clients find ecommerce solutions for their small businesses. But I want folks to be satisfied with their online store experience – and am writing this article in the hopes that it will help some of you get a better understanding of what it takes to develop and manage a successful online store.
Want a Demo?
Watch a video tutorial of my own online demo store, from the viewpoint of the customer and the viewpoint of the store owner.
Enjoy!
Jill--------------
J. Olkoski
Aldebaran Web Design, Seattle
Jill Olkoski has a BS in Engineering, a BS in Computer Science and an MA in Clinical Psychology. She delights in using her advanced technical and psychological skills to help small business owners develop cost-effective and successful websites.
June 18th, 2009 at 11:53 am
Jill,
In this challenging business econonmy that we are currently in I have found that my online store is requiring more of my effort than ever. Many of my problems are coming from issues beyond my control like inventory shortages from vendors, and the problem that is created by relying on their inventory level as a way to supply my customer in a timely fashion. I’m stuck in this zone where I can’t handle any more inventory or drain on cash flow right now and I dont know which way to go to grow what I’m doing.
Simply put my business has grown from nothing, to several thousand dollars every 90 days, in just two years on the internet in its current form. However it still does not support me full time, and I am trying to find a way through this phase where i dont know how to grow any further.
Should I consider a partnership with an established physical retail store? Should I consider advertising my website for sale to an already established business that could benifit from what I have built? Should I consider that this might be the peak of what I can do, and stop trying to find any way of expanding or evolving the thing into something larger? Or should I just keep my nose to the grind stone, paying what bills I can, not taking any profit from the business, and trying to find some way through this uncomfortable phase that I am in?
June 18th, 2009 at 12:15 pm
Hi Aaron,
I’m not a business consultant, so you can take my thoughts with a grain of salt. It sounds like if your vendors were faster to fill orders, you wouldn’t have to carry so much inventory, which is costly. I used to work for Motorola, and one of the major manufacturing initiatives always centered around reducing the number of inventory turns, to pursue a “just in time” delivery system.
While it’s possible a partnership might work, or even selling the business outright, I’ll give you some the questions I’d want answered before making these decisions.
First off, I’d want to be able to analyze your website traffic in detail. Is your problem that you don’t have enough volume of traffic, or is that the conversion rate is too low? These are two very different issues. If you don’t have enough volume, then you need to work on SEO or possibly some pay per click advertising. If the traffic is good but conversion rate low, then your should take a very close look at your website – the shopping cart appearance, feature, checkout process, etc to see where clients are getting turned away. If your website is not working well, then you don’t want to dump money into more traffic. But if it’s converting well, then paid traffic might be a good thing to consider.
The first step would be to analyze your traffic and measure bounce rates, conversion rates, how many pages till checkout, shopping cart abandonment, etc…all the metrics that would help you determine whether the traffic is simply too low, or the online store has some fundamental issues. That’s the best advice I can offer.