Wednesday, March 24, 2010

Dropship and eCommerce Solutions

Guest Blogger: Suzanne Lucas – Communication Manager of Shopster eCommerce

Shopster offers a suite of Dropship and eCommerce solutions for small to medium sized businesses. Thousands of online merchants from around the world rely on Shopster as it simplifies the complexities of online retail, allowing merchants to manage their store, transactions, and supply chain relationships in one easy to use place. Joining the Network is free, so merchants can focus on growth and relationships, not on costs. Shopster is an official eBay Solutions Partner.

Choosing the right products when starting your online eCommerce business

One of the very first things you need to consider when setting up your online business is deciding which products to sell. While your choices are almost limitless, - jewelry, electronics, clothes, accessories, home décor, Chia pets etc - it can be a bit overwhelming. Before jumping in head first, consider our suggestions below. These guidelines will set you on the right track to choosing products that will compliment your business and set you on the path to profitability.

Choose a target Market
The very first thing you need to do when deciding on product lines is to determine who you’re going to sell these products to. Or, more specifically who will buy the products you’re selling. If your products only appeal to a very small subset of the population, that might not be enough to build a viable (and profitable) business. While it’s unlikely that your product line will appeal to everyone, it should be something that a large sub section of the population could be convinced to buy.

Profit Margin
Make sure you can make money selling your products. Don’t forget to take into account direct and indirect costs associated with selling the products - shipping, any stocking or holding costs, advertising/marketing costs etc – they add up and can cut into your margins if you’re not careful. Consider using dropship suppliers to source your products, as they will help reduce your risk and eliminate any inventory costs for your business.

Knowing what’s hot now is great, but knowing what’s going to be hot two months down the road and making sure you’re selling that product is even better! That’s what’s going to make you money and set you apart from the competition. Being able to identify and source future product trends is an invaluable tool that comes from experience and knowing your target market.

Competition is a part of any business, however, the smart entrepreneur will pick his or her playing field wisely and enter into an arena that they feel they can succeed in. Choose more unique product lines so you’re not directly competing with the big-box retailers (and every other Tom, Dick and Harry). Also, consider offering value added services like superior customer support and product guarantees so you’re not limited to competing on price. That way you don’t cut into your product margins.

When looking for product lines, look for items that your customers will need to replace fairly regularly. I’m not encouraging you to sell poor quality products, all I’m suggesting is to consider selling products that have a recurring sales value. Laptops, clothing, furniture, these are all consumables i.e. customers need to buy these products more than once in a lifetime. By building out a customer base with recurring needs you encourage repeat business. Plus, repeat buyers are more open to other product lines and sales suggestions.

The golden rule: Don’t sell something that you wouldn’t give as a gift to a close friend or buy yourself. It’s that Simple.

And finally…
When starting out, the best advice to follow is to keep it simple. It’s very tempting for the new entrepreneur to tackle too much, too soon. You’re motivated, you’re excited and you fall into the trap of taking on too many product lines, and trying to appeal to too diverse of a market much too quickly. Start small, find out what sells and where there are margins, and build on that. It’s far easier (and less costly) to expand your operations when you’re enjoying success than it is to reel yourself back once you realize you’ve over extended yourself.

The key to a successful business is to know your products, know your market, and be able deliver one to the other. So do your research early on, and I guarantee that when you find a product line worth selling, you’ll be ahead of the curve.

For more dropship and eCommerce tips visit the Shopster blog at

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