How Much Does It Cost To Start An Ecommerce Business?
An eCommerce business seems to cost less than the traditional offline ones. However, the specific money that needs to be invested is still a question and varies for many business fields. There are so many budget-related concerns of entrepreneurs who want to start up their businesses on eCommerce platforms. This article will list out all recurring expenses in the early step of doing eCommerce businesses. Afterwards, we will suggest some solutions to deal with financial problems. Expenditure At The First-Stage Of New Ecommerce Business Some Kinds Of Cost According to a survey from Shopify, new eCommerce businesses spent most on product-related costs in the first year, at about 32%. Product is the backbone of starting and developing online selling businesses, including inputs, manufacturers, inventory, distribution, etc. The starters usually pay nearly 19% of their budget to their employees’ benefits, salaries, and rewards. Marketing, operation, and offline-related costs accounted for around 11% of their resources, including branding costs, additional software, rent fees, etc. Two other expenses belong to online stores (website construction, design, etc.) and shipping (packaging), which usually make up 10% of the budget. Besides some fixed costs above, there are some variable costs and additional costs that eCommerce business runners need to pay attention to. Firstly, start-up eCommerce businesses often face shipping-related problems like damaged or returned items or extra charges due to bad weather conditions. Secondly, some unexpected costs like insurance, permits, and licenses will make entrepreneurs surprised. Last but not least, a mistake in order quantity leads to surplus inventory that the company pays some money to correct. How Much Does It Cost For Each Business Size? It has been found that an eCommerce business without employees will help you save nearly 70% compared to doing business with employees. In detail, a person who runs the online business by himself usually spends $18,000, while owners who are accompanied by up to four employees spend $60,000 in the first year. Where Is Financial Source? It may not be surprising that most financial support comes from owners’ pockets or personal savings, accounting for nearly 70% of all financial capital. Whenever the eCommerce business earns profits from their sales, they will be re-invested in company capital and continue to make profits again. That is why 30% of investment comes from previous revenues. Moreover, new business runners also borrow money or depend on friends on family investment, at equally 20% of total capital. Our Budget Recommendations Before going into the recommendations, it’s necessary to go through some facts from reliable research. Firstly, the more money spent on employees, the more profits the companies can make. Hence, the recommended cost for teams, laborers should range from 14 to 30% of your overall cost. Moreover, automation applications will help you finish some repetitive and product process tasks like order fulfillment quickly and accurately. Secondly, the more money spent on marketing, the less revenue the companies gain. Over-promotion is a prevalent problem for new businesses, leading to misleading advertisements with overrated product quality. Therefore, new-launched companies should spend 7 to 8% of their total revenues on marketing and promotion. Thirdly, some suggested costs over total expenses for other business activities. In detail, the operation cost is from 10% to 15%, shipping prices are from 8% to 12%. Besides, charges for online sites are 9% to 10%. Last but not least, the most significant part of your investment is in products, which is between 28% and 36%. Products play a crucial role in your eCommerce business, so it is difficult to cut down on this expense. However, we have a solution to reduce the cost if you have low capital and inventory. That is Backorder. With Backorder, you can allow customers to purchase products at pre-order status without any items in your warehouses. Therefore, you do not need any money to buy products from suppliers or wholesalers to make it available before. Conclusion We have illustrated some financial issues for new ecommerce businesses. We hope that after reading, you can depict a cost-benefit picture of your business activities and apply some recommended solutions to avoid loss and valueless investment.
Top 10 Ways To Improve Product Page Conversion Rate
The first impression and final thoughts are the two most essential steps for customers to make final decisions: buy or not. Depending on personal preferences, there are too many reasons why customers ignore or give up your products, leading to a low product page conversion rate and considerable loss. Today, our blog will suggest 10 most practical ways to help your business improve those problems and thus boost your revenues and profits. 10 Best Approaches To Increase Product Page Conversion Rate 1. Remark Products Value At A Glance Customers do not want to take too much time to read a long detailed description of products and brands. Although your products have some convenient features for buyers, it is not easy for customers to realize it in such a long paragraph, and thus they ignore those items at a glance. To boost the product page conversion rate, you may need to make your products more attractive at first look. All the signatures, significant features, or informative content that can grab customers’ attention need to be highlighted to ensure that buyers can not ignore them. 2. Instant Message Activation There are thousands of questions about the products, services, and policies when the customers come to your online store and buy something, especially the first time. It is genuinely inconvenient to send an email and wait for days to be responded to. That amount of time is enough for customers’ forget what they want to buy and thus reduce product page conversion rate. The most effective solution is activating live chat on your selling site. The customers can address any problems immediately and receive support instantly. You can pre-set some automatic answers for frequent concerns of customers and assign some support to help with more complicated issues. 3. Catch Customer Insight Customer insight has been the most potent but mysterious tool to enhance customer experience and increase product page conversion rates. However, drawing a picture of customers’ insight is truly difficult. There are some ways to understand what customers think, concern about, and want. You can use some automatic application to track customers’ behaviors in your eCommerce stores. Then, comprehend and analyze what has been recorded to find out customers’ concerns and expectations. 4. Display Call-To-Action Motto When customers visit your offline stores, staff will approach them and encourage them to buy products. However, you don’t have any staff in your eCommerce stores. That is why you need another factor to make customers pay more attention to your products and have more motivation to buy them. The Call-to-action motto should have great content and a remarkable design, playing as a persuader for increasing product page conversion rate. Another point you need to consider is that the call-to-action motto must not be an eyesore and should be consistent with the page architecture. 5. Take Advantage Of Animation It can be seen that images can not be as impressive as video, animation, or GIFs. Moreover, the customers trust the information conveyed by video rather than ideas. Also, video and animation can make your eCommerce site more lively and thus increase users’ experience. To avoid some drawbacks, you should not add too much video and animated content. As it takes a lot of time for customers to watch, and its capacity will slow down your site traffic. 6. Present Previous Reviews And Feedbacks Product description and buying guide are not enough for customers to make orders. The most crucial and the key-driven element is customers’ reviews and feedbacks. You should keep honest reviews and comments from buyers for your goods and services to build customers’ trust. To minimize the irrelevant and negative comments, you should manage all the low-star rates tightly, find out the reason and solve customers’ problems. Moreover, all the spam and irrelevant comments need to be deleted or hidden from your pages. The remaining positive and relevant ones will be the influential factors to improve product page conversion rate. 7. Show Social Proof Of Brands And Products Any certificate, legitimation, or recognition from reliable organizations should be presented along with a product description. For instance, if you sell sunscreens and claim that your products do not contain alcohol and paraben, customers will doubt whether that feature is tested or examined. Social proof will help your products become trustworthy, reinforce the brand’s reputation, and increase product page conversion rate. 8. Utilize Cross-sell And Upsell Maximizing quantities of products sold and profits is the top priority goal of selling. It can be expressed by some product recommendations. You can base on the customers’ behaviors on your eCommerce site, which your automatic applications track to pop up some relevant offers. Moreover, you can pre-set some suggested pop-up items with the same features in terms of colors, styles, function, or complementary products. This action can give customers a wide range of options and thus increase product page conversion rate. 9. Manage Inventory The inventory should be highly controlled to ensure smooth buying procedures, and all customers can buy their favorite products. At this stage, you should use some inventory management applications to support organizing multi-channel warehouses and plan the stock-related processes. The customers will be disappointed whenever their products are unavailable or have some problems that they can not buy immediately. Effective inventory management will increase product page conversion rate as it can ensure every customer can buy what they want with one click. 10. Allow To Purchase Backorder Products Although you have managed your inventory well, some inevitable problems prevent customers’ from buying their expected products, especially in the holiday sale season. Many buyers visit your eCommerce store and buy a lot of products in a few minutes. That short time is not enough for you to instantly restock all of the items and thus let your shelves empty. Fortunately, Backorder could be the hero to rescue you from that situation. If your eCommerce stores are on Bigcommerce platforms, Backorder will allow you to set the backorder status for products. Whenever it is sold
How To Deal With Rapid Ecommerce Demand Growth
Along with widespread digital transformation and cutting-edge information technology, eCommerce demand has increased dramatically in the modern business world. Due to the unprecedented development of eCommerce demand, some new arising problems need business runners to tackle. Today’s article will draw some consequences of that growth and bring some practical approaches to avoid side effects. Demand Fluctuation And Labour Shortage During Pandemic The covid-19 has attacked our world with severe disease and long-lasting social distancing. As a result, selling activities, no matter wholesalers or retailers, have suffered from various hardships. The pandemic has negatively affected our human capital, leading to a significant labor shortage and productivity reduction. Moreover, social distancing has created plenty of barriers to active warehouses, distribution, and other activities. That’s why more and more companies expand to eCommerce platforms, leading to abnormal eCommerce demand growth. Automation Is The Answers Business lack of employees has detrimental effects on productivity, revenues, and profits. There are a lot of tasks that need to be done, and an abundant process needs to be run. Here, automation can automate most of the process quickly and accurately. For instance, it can accept and fulfill orders. Sending notifications to customers instantly and supporting frequent problems are also crucial roles of automatic applications. The physical barriers to warehouses or brick-and-mortar stores will be deleted by the automation application. With the powerful integration and inventory management ability, business runners can connect with other platforms to do necessary tasks and connect with their partners. Growth With Careful Management When the number of orders increases unexpectedly in the first days of social distancing, business runners will be overwhelmed and get into trouble tackling all orders. Automatic methods will help sellers with order fulfillment and other tasks like customer services, detecting fraud orders, minimizing errors, and tracking product-related processes. With automated applications, the sellers can keep a close relationship with customers and even boost their productivity and profits in this problematic situation. The eCommerce demand will bring conveniences to buyers and challenges to sellers. To keep customers happy with each order, the sellers and business owners should accompany automatic applications to fill the labor shortage and enhance the buying experience. Due to the over-purchasing, out-of-stock status is inevitable even when you possess good automatic inventory management. Therefore, sellers need to have some backup plans whenever they have nothing to sell. A lot of companies take advantage of Backorder on the Bigcommerce platform. A backorder can allow customers to purchase items even if it is unavailable as pre-order status. Then, you can prevent them from buying at your competitors’ stores and maintain satisfaction. Standardize Shipping Process It is not as difficult as you have imagined about shipping nailing. You can use the pre-built workflow to ship orders to customers or customize your one to fit a particular working style. The automatic applications can track shipping processes tightly and help you realize the possible delayed shipment, and make it arrive as scheduled. Moreover, if you sell on various markets and have a lot of distributors. Omnichannel automation will help you connect all the sources with real-time notifications and synchronized processes to manage efficiently. Example Workflow Here, we bring you an example workflow of Atom8 when it conducts a fraud order detection process. The formula is customers’ history analysis to predict their behaviors and then send the internal notifications to your staff responsible for these orders. Conclusion The rapid eCommerce demand growth has opened a lot of opportunities and threats. To take advantage of opportunities and avoid hazards, you may need to adopt our recommendations above with automatic application. We hope that you can optimize your productivity and earn a lot of profits.
Top 5 Seasonality Stock Management Tricks
Every year, sellers usually look forward to special events like Christmas, Black Friday, etc., or product-preferred seasons that bring considerable customers and revenues. However, there are some obstacles that sellers need to confront before gaining expected turnovers. They all relate to seasonality stock management. Today, we are here to help you prepare for the upcoming busy season with five awesome hacks for fulfilled seasonality inventory management. 5 Fabulous Hacks For Seasonality Stock Management Understand Your Supply Chain The supply chain plays a crucial and direct role in customers’ expectations. A smooth and trustworthy shipping process will ensure your product arrives at customers’ houses as scheduled without any mistakes. Choosing the third-party logistics company suitable for your suppliers and distributors will help you reduce additional costs in busy seasons and thus maintain lubricated workflow and productivity. Financial Track If you manage multi-stores in busy seasons, there are some arising financial accuracy problems. The more orders are, the more complex bills and financial statements are. Due to the large numbers of orders, a small mistake can lead to considerable loss. The fulfilled financial track and well-controlled seasonality inventory allow you to manage products and cash flow. Moreover, the specific and transparent financial reports will help you evaluate your companies’ cost-benefit in this hot sale season, predict new trends, and establish suitable policies. Optimize Inventory System As you know, the product is the backbone of sales. Manage products processes or control seasonality inventory well is the critical element for a successful hot sale season. In seasonality inventory management, there is something more than organizing the inventory. You will deal with an enormous quantity of products and must decide whether to store all of them or not. If you want to put all of them in your warehouses, the storage costs will be considerably high. However, if you do not store it, your product’s workflow and shipping process may be disrupted due to unavailable items. As a result, you need to take into consideration the significance of each kind of product, what products are in the top best-seller lists, and which potential products can help you earn a profit. Analysis and planning with automatic application supports will help you choose which product must be in your warehouses. Activate Backorders To be honest, over-purchasing is no longer a strange situation despite the careful seasonality stock management. Therefore, it would be better if you prepare some approach to confront this situation. Backorder is one of the powerful tools to help you tackle out-of-stock status in BigCommerce platform. It can allow your customers to buy unavailable items to help you gain revenue with nothing in your warehouses. To do that, you need to pre-set all of your products with Backorder. Whenever they are sold out, the pre-order status will be automatically activated. As a result, it helps your sales avoid being disrupted and enables you to reduce customers turnover rates. Try the app: Maximize Productivity Effective seasonality inventory management enables productivity optimization. The complete order fulfillment, real-time tracking, immediate support, and transparent reports will give you chances to reduce unnecessary costs, evaluate your companies’ performance and thus plan future directions and adjust something compatible with the current context. Conclusion We hope you already had some ideas to manage seasonality inventory to prepare for upcoming hot sale seasons with five proven hacks above. Moreover, we also believe that you will no longer feel it challenging to sell a large number of goods and services.
