New Business Venture

AmandaDale

Hello,

I'm Amanda, I've been reading MSE for some time now, some very useful information around, we (me and my time) are currently starting a new business venture, but we cannot decide if it should be online only or online and shops, each have good and bad points, for example online only means cheaper running costs, but shops allows for customers to get a feel of products but running costs are higher plus more staff is needed incase staff take ill/leave.

What advice could you offer me please, all advice is welcome.

With Thanks, Amanda.

pitkin2020

That question can't be answered as simply as that i'm afraid without knowing what you intend to sell.

For example if you selling cd's either would work but online is where the market is at I would say. If your selling clothes a lot of people would like to touch and try them on before buying.

More details are needed to make a proper informed opinion.

AmandaDale

Hi pitkin2020,

We will be selling electrical goods.

With Thanks, Amanda.

pitkin2020

AmandaDale wrote: »

Hi pitkin2020,

We will be selling electrical goods.

With Thanks, Amanda.

HHMM, well online works well for that kind of market but its competitive and when it comes to online shopping it will come down to reputation and price alone. People tend to price shop online, so a samsung TV from amazon for £500 will outsell a samsung tv on an unknown site for £500 or even £400 for example. People are starting to realise they have to be more pre-cautious of online shopping so building up that positive reputation can be hard work and time consuming.

Some people will pay a premium for being able to go and handle it, view the picture in store and hear how it sounds (tv/stereo for example) and being able to walk away with it there and then.

Again depending on what you really intend to stock decide if you think people will pay the premium to go and view the TV in store or if they will just buy the electric tooth brush online. If you go shop the route what can you offer the local retailers aren't offering.

Budget could even make the decision for you, with the shop you need a large budget for the lease, legal stuff, refit and fixtures before you even add in the stock. With electrical items you could be needing a lot of startup to fund just the stock.

Seraphim

pitkin2020 wrote: »

HHMM, well online works well for that kind of market but its competitive and when it comes to online shopping it will come down to reputation and price alone.

To expand on this, when you say "online" do you mean you will have a standalone website or are you planning to go down the eBay/Amazon route (or both )

If you are building your own website, how will you attract customers? Online marketing is really competitive - SEO takes time to achieve, and if you are inexperienced with SEM it can cost you an absolute fortune if you don't know what you are doing.

CKhalvashi

AmandaDale wrote: »

Hi pitkin2020,

We will be selling electrical goods.

With Thanks, Amanda.

We’ve bought through drop shippers on several occasions, including a £2400 discount on out 65” TV, however this would only work well with eBay/Amazon.

It’s upto what you’re selling, however it may be worth going along the lines of both. MoonFruit/PeoplePerHour can both ensure you get a good website at a good price.

This is not my specialism, so I’m sorry I can’t be of more help.

Chris

Conrad

My Brother set up a gift site a couple of years back and it is doing well. With high priced electrical goods reputation, trust, price and returns policy will all be important business drivers. As an example we just bought a flat screen tv after all these years and went to John Lewis. Why, because we trust them, we know we get a no quibbles refund if needbe, we know we can call a Human in England and get help with any problems.

I bought a bike online recently. Never again. It came in bits with Chinese instructions, no helpline number, nothing. People are wising up and realising there's more to life than getting the absolute lowest price.

heretolearn_2

I think it's extremely hard for small on-line traders - you probably can't even buy your stock at a price that larger companies can sell it for, and there's nothing you can do on service/locality/convenience to attract customers to overcome that, unlike an actual small shop. On the other hand, your costs are very much lower, and some people do make it work. But I think trying to compete on major brand items is not going to go anywhere - if they'll even agree to supply you. It's more about finding unusual/hard to source/new products that the big boys haven't woken up to.

pitkin2020

CKhalvashi wrote: »

We’ve bought through drop shippers on several occasions, including a £2400 discount on out 65” TV, however this would only work well with eBay/Amazon.

It’s upto what you’re selling, however it may be worth going along the lines of both. MoonFruit/PeoplePerHour can both ensure you get a good website at a good price.

This is not my specialism, so I’m sorry I can’t be of more help.

Chris

Drop shipping works well with pretty much all online models not just ebay or amazon so I don't know how you can only claim it to work with those. Its low risk, low investment and you carry no stock so whether you sell through a website or ebay its a great way to get started. Obviously drop shipping wouldn't work all that well in a shop environment as its expected to be able to pay for it there and then and walk out with it in the majority of most cases.

There are plenty of ecommerce solutions around, it would be best to learn it yourself to begin with not only to save costs on the start up but to save costs everytime you want something add/removed. You should also be able to fault diagnose if you have problems with the site too. Avoid the sites that only have a few templates, if you want to stand out from the crowd don't use a site that looks just like everyone elses.

pitkin2020

heretolearn wrote: »

I think it's extremely hard for small on-line traders - you probably can't even buy your stock at a price that larger companies can sell it for, and there's nothing you can do on service/locality/convenience to attract customers to overcome that, unlike an actual small shop. On the other hand, your costs are very much lower, and some people do make it work. But I think trying to compete on major brand items is not going to go anywhere - if they'll even agree to supply you. It's more about finding unusual/hard to source/new products that the big boys haven't woken up to.

It is hard and like you say when it comes to branded items everyone is selling them so you will struggle to compete on price. That said every business needs to find its USP to stand out from the crowd.

When it comes to online sales far too many people think its an easy buck but it takes a lot of time, far too many give up after 4 months because they expect to do very little in advertising and people will come flooding. You have no presence on the internet unless you make yourself heard. Your competiting with billions of other businesses just just a handful like you would be on the high street.

The internet boom has been and gone, yes money can still be made and it can be made big if you get it right. If you can't stand out from the crowd though you'll just be another search result on google after page 2.

AmandaDale

Thank you to everyone who has replied.

We have been looking at different brands, the brands the other stores don't target, I think this could work in our favor, the big companies like play.com and ebuyer.com from what I understand will be working on tight profit margins of top brands.

With Thanks, Amanda.