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How To Start An eCommerce Website That Works!

by Neil Jones

ecommerce dropshipping

E-commerce is the selling of products and services on the internet. This can be achieved by setting up a website that contains tangible or intangible products/services. The concept behind e-commerce is actually quite simple; however, understanding how to correctly execute the establishment of a solid business can be a real challenge. In this article we will explore the different steps that should be undertaken, and additional information that could help you and your fledgling business into the market with which you want to dominate.

Step One: Find Your Niche

Before you even consider setting up your website, you need to consider what you’d like to sell.  This is the most important part of the process of setting up an e-commerce website. This is because the products or services you will be selling needs to be good, and they also need to have a high sales potential. However, it is also important to find a product or shop type that isn’t too heavily saturated, or you will not be able to compete with other online shops that have been around for a long time and are market leaders. In step 4 we will talk about how to source products, stock and ship them.

Step Two:  The Website

While having a good product or service is important, the website where you’ll be selling is also important. Having a website built from scratch is not a good idea if your budget is small, so try to find a company that provides a hosted e-commerce software package. There are quite a few providers on the web that allow you to set-up low cost websites that also incorporate the premise of e-commerce; they allow you to create a slick design without the need for any design skills. Be sure to check that you can edit the websites code, as this will prove beneficial when your company grows and you can afford to have a designer build a customized look and feel for your business. It is important that you are able to edit your own website to change simple things, such as your widgets, add additional elements, edit your logo, etc. Some of these you can do on your own as there are countless hacks, tips, photoshop logo tutorials, website development tutorials, and more vailable out there.

Your website should have sections for your products, pictures of your products and an easy way to pay for them.  It should also have a clean design, some information about what you sell on the front page and a way for customers to easily contact you. Some websites like to include other pages such as a news page, terms and conditions pages and site maps. It is recommended by Google to have pages with good, rich and informative content as it is useful for SEO, which stands for search engine optimization.  Search engine optimization is the placement of a website in search engines such as Google, Bing, Yahoo and Ask.

Step Three: Sole Trader, Ltd or PLC?

It is important to consider whether you need to register your company as an actual business. There are various benefits for each type of business and there are about 4-5 types of registration, but to make things simply I’ll roughly skim over the main three. Being a sole trader means you do not have a registered business. This does not means you cannot run a business, it simply means you do not have the title of being Ltd or PLC. It also means you are not protected by the registration of a business, which means if you accumulate any debt it will be in your name and will be your responsibility to pay back. If you register as an Ltd business, you are protected by your company and you will only have to pay back what you invest in the business. Having a registered Ltd business also means that you can command respect and trust on the internet, a place often daunting to customers.

However, having an Ltd business means that you must submit records to the appropriate sector of your government (known as Companies House in the UK). It also means you have to undertake various procedures such as an annual audit, the taxation of employees and the requirement of having a business address. If your budget is low and you have no staff, do not register as Ltd. Only register as an Ltd when you need financial security over your business and if you’re hiring staff. Do not register as a PLC company unless you think that you company is worth a lot and you’re happy to float you businesses shares on the stock exchange.

Step Four: The products

Once you have decided on your niche the next step is to find suppliers. There are a number places you can look, the directories, forums, or tradeshows have all proved useful to me in the past. Now there are 3 main types of suppliers, Distributors, wholesalers and dropshippers. Usually highest up the chain are the distributors and this is where the biggest discounts can be found but it can also mean bigger minimum order quantities. When starting out I would always look for wholesalers or dropshippers, these types of companies are usually more flexible in their terms and have lower minimum orders.

The next decision you will need to make is if you want to hold the stock yourself or use a dropshipper to process all the orders for you. There are a number of deciding factors here, the size and cost of the goods, whether or not you have the means to store the stock and take care of the order and dispatch process. Dropshipping holds a number of advantages here as the dropshipper takes all this away from you, they will store the merchandise, process and ship the orders once they are received. Using this option decreases margins but it will allow you to concentrate on generating sales and revenue.

Article by

Neil runs eMobileScan one of the Uk’s leading Handheld computers specialists including the Symbol MC70 range of rugged handheld. Our goal is to offer our customers a solution that will save them time and money.

Neil has written 3 articles at iBlogzone.com

1

Murlu

December 10, 2010 at 1:27 am

I’m really excited that my friend and I are going on a trip to Asia because this is exactly what we had in mind. I’ve worked at a company doing the online business portion, can setup sites and generate traffic – my bud knows shopping carts and the payment processing backend; combining our two powers with the ability to find manufacturers while we’re on vacations is going to be killer!

2 Joel December 10, 2010 at 4:53 am

Neil, Nice article.

A question..Any idea about good dropship suppliers? Looking for several and recommended to try SaleHoo by a friend.

3

Stuart

March 10, 2011 at 12:28 am

@Joel – I set up a few e-commerce sites using a dropship supplier for the goods in my spare time last year, mainly to research a marketplace I was interested in and slightly for the fun of it too!, the amazing thing was how easy it was to get the site to quickly start generating some sales, the bad thing was, found this out after wasting time promoting my sites, the fact that most of the dropshiping companies who operate in the UK are solely in it to bag the initial fees and then provide a very poor service, no names mentioned but if you do research on droshipping in the UK the ones I’m talking about will be the top 3 companies you hear about, just it will be only one company with many faces and a very poor service and reputation 😉

My advice would be to hold your own stock.

4

Neil

December 10, 2010 at 9:07 am

Hi Guys,
Murlu, business partners that compliment each others skills work great, if you both stick with what you are good the two of you can do the work of 3 people, well enjoy the holiday best of luck and continued success.
Joel, You just might find a couple of jems in there, but from experience, jumping onto a site that is targeting ebay sellers is a bad idea. Chances are the markets for the vast majority of their product lines are saturated and the competition is driving the margins right down. I haven’t used the site but the ebay thing would worry me, if you have a certain product in mind, contact some of the distributors, sounds them out and if they won’t play ball ask if any of their customers would be interested in dropshipping. Show them what you have done in other markets, this can prove that you can drive sales for them.
Well best of luck

5

Ryan

December 11, 2010 at 3:03 am

Hi Neil
Thanks for your great article , Neil. It is very clear to show us how to start promote our bussiness online step by step. I have the question is how can we find the supplier and do you think the supplier they believe we can promote their productions well just with a website ?

6

Neil

December 13, 2010 at 5:39 pm

@ Ryan, finding suppliers will depend on your market place and how you want to run the business, Tradeshows can be a great place to look, even if you can’t make it, look at the list of suppliers that have exhibited and give them a call, sometime it’s just a case of burning the phones until you find one that ticks all the right boxes for you, this is what I look for,
No minimum order value
Are will to ship direct to customers.
Holds a lot of stock and can supply stock feeds.
Some suppliers will sometimes ask you to hold a set amount of cash in an account, this isn’t ideal but it can help you to build up a good relationship with them and eventually they will cancel this request.
And the second part of the question is again down to the market you are in, if you plan to hold the stock, most suppliers don’t really care as long as you can pay on time. When you order small amounts don’t expect very much in the way of a discount.
Hope this helps to answer your question, if you want to PM me more details I would be happy to help.

7 Aswani December 13, 2010 at 6:18 am

Excellent article. Very detailed, useful and informative. And I really liked it more because it is related to my field of interest. We are also involved into ecommerce business here and I must say, it is never easy to start one. A lot of thinking is involved into deciding what and how. Risks too are involved But anyways, if you have the right products to sell online then you should certainly go ahead with the same by planning it all in the best way possible. These tips as mentioned above in the post are certainly going to help me and others a lot in deciding over how to start an ecommerce website. Thanks a lot for sharing these valuable steps.

8

Neil

December 13, 2010 at 5:45 pm

@Aswani, thanks for the words of support. Sometimes an ecommerce site can be hit and miss, the best thing you can do when entering a new market is to know every detail down to the minute detail. Starting any business is a gamble, all you can do is to stack the odds in your favor and know everything you can about a market place . Well best of luck

9

Anne - InteliWISE

December 14, 2010 at 5:15 am

For startup e-commerce sites, is it okay to use a free blog service like wordpress or blogspot? I don’t want to spend much because I will be spending on the products I will sell first.

10

Neil

December 14, 2010 at 1:06 pm

Hi Anne,
A little unsure as to what exactly you mean, do you want to host a free blog
like mysite.wordpress.com, if so it’s not a great idea it won’t offer you any value, you will have to put alot of work into building this site up and if you decide to go ahead with the ecommerce site you will have to do it on a new domain. At least launch the blog on the domain you plan to run the ecommerce site on

11

john marry

December 28, 2010 at 6:31 am

Hi Neil!
Well structured post there.
I strongly consider the 1st point that is “Find Your Niche”.
Finding the target market is most important.
people often come in online business and with out focusing a specific target market,then thinking “why they are struck in the middle”.
nice points.

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