Much has been written about the advantages of e-commerce from the customer's point of view, but it is just as advantageous from the business person or merchants point of view.
With e-commerce, suppliers can reduce costs to manage their inventory or stock because there are many very good web based management systems on the market that make automating the task easy. That is of course if you decide to hold stock. Many online businesses use a drop ship type business whereby the e-commerce business does not have to hold stock at all.
E-commerce expands the marketplace from a local or national business into an international one overnight. The ramifications of this are considerable indeed for the online retailer. Admittedly if the website owner is selling perishables it will be hard to do business outside a certain geographic area, but otherwise there is considerable scope for.
Online retailing is "tailor made" for monitoring customers buying habits. You can track the interests and preferences of customers and what is very important and rarely appreciated enough, is the fact that you can suggest follow up products and services to existing customers.
The next advantage from the online retailer's point of view is that you do not need physical premises to trade from. In fact many "bricks and mortar" retailers have taken the (often very emotional) decision to close their premises and go completely online. We recently saw an item on television about a lady in a nearby town who shut her millinery business, so saving about £1,500 per month in costs and expenses related to having a premises in the high street. Her turnover dropped by about 15% to 20%, but she was immediately a lot more profitable and her cash flow improved overnight!
Finally when you start your online business you very quickly realise that there are many many opportunities to use the flexibility of the business model in a number of ways. As an example you can start to outsource mundane tasks as much as possible. However this means sitting down and taking a very hard look at all your working practices. It is very easy to fall into the habit of chasing every customer as much as possible and trying to do as much as possible yourself. But remember that eighty percent of your time must be spent on marketing your online business and that means you have to study and learn the techniques to do this. The main thing is to find a company that takes you through every step of setting up an online business and train and help you to begin to make sales online.
Peter Robson is an accountant with over 30 years experience in the small company sector. With his business partner, Debbie Crossley he runs a company helping people set up and run e-commerce businesses. For more information go to http://www.yournichebusiness.co.uk/
