Becoming an on‐line seller Part 1: Possibili-es for a Small Handmade Business
Selling online: what it is? Online shopping is the process whereby consumers directly buy goods or services from a seller in real‐-me, without an intermediary service, over the Internet. It is a form of electronic commerce. An online shop, eshop, e‐ store, internet shop, webshop, webstore, online store, or virtual store evokes the physical analogy of buying products or services at a bricks‐and‐ mortar retailer or in a shopping centre. The process is called Business‐to‐ Consumer (B2C) online shopping. In other words: to sell online means to maintain a constant internet presence and oﬀer your wares or services for monetary exchange 24/7.
One month diﬀerence December to January 2010, and it’s s-ll growing!
Who shops online? • 56 % of all online shoppers are women • The average age of online shoppers is 42 • The mean household income of an online shopper is $65K • Average yearly spending is $446
How does it work? • Consumers ﬁnd a product of interest by visi-ng the website of the retailer directly, or do a search across many diﬀerent vendors using a shopping search engine. (SEO!)
How does it work? • Once a product has been found on the web site of the seller, most online retailers use shopping cart so[ware to allow the consumer to accumulate mul-ple items and to adjust quan--es, by analogy with ﬁlling a physical shopping cart or basket in a conven-onal store.
How does it work? • A "checkout" process follows in which payment and delivery informa-on is collected, if necessary. The consumer o[en receives an e‐mail conﬁrma-on once the transac-on is complete.
How does it work? PAYMENT Online shoppers commonly use credit card to make payments, however some systems enable users to create accounts and pay by alterna-ve means, such as: • Billing to mobile phones and landlines • Cash on delivery (C.O.D., oﬀered by very few online stores) • cheque • Debit card • Direct debit in some countries • Electronic money transfers of various types • Gi[ cards • Postal money orders • Wire transfer/delivery on payment
How does it work? PAYMENT Some sites will not accept interna-onal credit cards, some require both the purchasers billing address and shipping address to be in the same country in which site does its business, and s-ll other sites allow customers from anywhere to send gi[s anywhere. The ﬁnancial part of a transac-on might be processed in real -me (for example, lefng the consumer know their credit card was declined before they log oﬀ), or might be done later as part of the fulﬁllment process.
How does it work? DELIVERY Once a payment has been accepted the goods or services can be delivered in the following ways. • Downloading: This is the method o[en used for digital media products such as so[ware, music, movies, or images. • Drop shipping: The order is passed to the manufacturer or third‐party distributor, who ships the item directly to the consumer, bypassing the retailers physical loca-on to save -me, money, and space. • Prin-ng out, provision of a code for, or emailing of such items as admission -ckets and scrip (e.g., gi[ cer-ﬁcates and coupons), or PDF ﬁles of various products and/or pakerns. • Shipping: The product is shipped to the customers address or that of a customer‐ designated third party.
Skills needed to open an online store 1. Branding: name your store and your products in such a way that it is recognizable to your customers, in other words build your on‐line iden-ty visually and by name (think of big brands that s-ck with us, and why are they so successful)
Skills needed to open an online store 2. Photography: Items on‐line are virtual, and images or video are the sense we rely upon when shopping on line. In order to sell your product, it has to be well presented visually to your customer. Good, clear photographs are essen-al. Interes-ng photographs that represent the product well in a sefng, or give an idea of how the product can be used are even beker.
Skills needed to open an online store 3. Crea-ve wri-ng: Second line of sale on line are good, informa-ve descrip-ons of items. The more informa-on customer can gain from your descrip-on the more likely they will buy it, and the less likely there will be issues with items being returned because they are not what the customers thought they were. The other possibility is making your customers intrigued with the descrip-on, or making them feel more personally akached to the item.
Skills needed to open an online store 4. The Art of Pricing: The price for the new store and the one well established is not going to be the same, but one should not undersell either. Do your research and calculate the -me, material, and eﬀort spent to produce and adver-se an item. Customers like a bargain, but don’t trust rock bokom prices with no feedback. Beker price a likle higher then what you’d consider to be your lowest price, and then occasionally oﬀer a discount to get sales.
Skills needed to open an online store 5. Marke-ng: Internet is a social place, use social media to promote! Also build rela-onships with other sellers, they are poten-al customers as well. A well placed ad is well spent money, so know your niche audience and seek places to adver-se to your speciﬁc customers.
Skills needed to open an online store 6. Accoun-ng: On‐line store is a real store. The money is real, so treat it that way and keep the books well organized. You will need to report it all to Uncle Sam and your state. A few advantages of this way is that you can also keep your books online as well as buy supplies.
Skills needed to open an online store 7. Shipping: You are selling virtually, but your product in most cases is not virtual. It does need a way to get to your customer. This needs to be cost eﬀec-ve for you, but it is also a way for you to adver-se your business. Pay aken-on to packaging: you may recycle, but be crea-ve about it; a hand wriken note included with the item goes a long way; and don’t include too many self promo-onal items, one card is usually enough!
Items absolutely necessary to open an online store • a computer with broadband internet connec-on • a good digital camera and some knowledge of how to take good photos (a higher quality point and shoot will work ﬁne) • online banking account (so you can get paid for your work) • Massachuseks business license
Items really desirable to open an online store • Email devoted to your online business ‐ also linked to your on‐line banking account • A room or space a side of your work area where you keep things organized ‐ for taking photographs, accoun-ng and shipping • A printer ‐ to save on shipping
Why start a small business? The Massachuseks Small Business Development Center (MSBDC) Network provides one‐to‐one free comprehensive and conﬁden-al services focusing on, business growth and strategies, ﬁnancing and loan assistance as well as strategic, marke-ng and opera-onal analysis. In other words: there is an exis-ng network of support!
How to start a small business? The most important step: WRITE A BUSINESS PLAN
Steps to star-ng a small business in MA • Consult an akorney regarding the legal requirements of sefng up and opera-ng your business. • Consult an accountant regarding the ﬁnancial and tax requirements of sefng up and opera-ng your business. • Register the name of the business with the state. ($50 with City of Boston) • Make appropriate applica-ons for licenses to operate in desired states. • Obtain a federal employer iden-ﬁca-on number (Form SS‐4). • Apply for state workers’ compensa-on and unemployment insurance. • Determine applicable job safety and health regula-ons (OSHA). • Determine applicable environmental regula-ons. • Apply for local business licenses.
How do you know if on line selling is for you?
How do you know if on line selling is for you? It helps to divide it into palatable chunks. Here are a few ques-ons you should ask yourself: 1. How much -me do I spend on‐line anyway? 2. What is my personal comfort level of internet usage? 3. How good am I at wri-ng descrip-ons of my items? 4. Can I, or somebody I know, take really good photographs of my items? 5. Do I use social media? Am I willing to learn? 6. Do I have enough -me to invest on developing this?
How do you know if on line selling is for you? If you answered posi-vely to at least 60% of the ques-ons, your prospects are preky good. Ul-mately it really all depends how much you are willing to invest yourself into learning a new way of doing things, and learning a new culture.
WHERE TO START There are a number of places to sell on line. To name just a few largest ones in USA: Etsy Arqire Dawanda Bonanza
Ques-ons – Comments ‐ Your thoughts I’d love to hear them. Really. No need to raise your hand, just speak up.