Planning to Join the Commerce World?

Every young entrepreneur looking for an advice on their business start-up. Having your own business is a learning process, there is a better chance of success as you make smart decisions. There are a handful of tips to start a new business, give your new business the best chance of success.

Write a business plan, and be passionate about it.

You have to devote more of your time and energy to start a business and to make it successful. However, no matter how passionate you are, it will not be successful unless you have a plan in place.  Most of the successful small businesses need a break-even analysis, profit-loss forecast and a cash-flow analysis.

A business plan is essential to allow you to experiment with a strategy for the business on paper.

Determine the profit the business will make.

The ultimate goal of every starting businesses is the profit, to know the profit, you have to do a break-down analysis, assess the expenses and how much you have to sell to cover the costs and start generating a profit.

Plan out a financial goal.

Determine the factors that are necessary to your business expenses to launch and operate. You will even have unexpected costs, it is better to be prepared than be short on the funds.

Once you have determined all the business expenses, plan out a business budget.

Most entrepreneurs build their businesses through loans, loans can cover the expenses. However, it will take months or years to produce a profit. Ensure that loans will not pull down your business, or better, save a capital before you start your business.

Do not do it alone, hire someone.

You need a support system while you are starting a business. However, you have to be picky about people, do not just hire someone who comes along with the basic qualifications. Have someone in your business who has the motivation, creativity, and the right personality. After you have hired the right person, make sure you give them the right and appropriate kind of employee relations.

Some business tries to save money by hiring people as an independent contractor rather than full-time employees. Watch out, the Internal Revenue Service imposes large penalties on businesses that do not withhold and pay taxes for their employees.

Provide the best customer service.

Businesses will not exist without the customers, figure out how to acquire customers to have a greater chance for your company to succeed.

Know and acquire the legal requirements.

Understand the rules and regulations in putting up a business. Legal structure, accounting system, business registration, and tax liabilities are few of the government regulations and your responsibilities as an owner. Follow these to avoid penalties, although it may vary from one place to another.

Over half of the newly built businesses fail within the first five years. It is a reality for some entrepreneurs to launch a business that became unsuccessful. You have to figure out how to revive your business when it will go downhill.

Failures in Commerce and How to Avoid Them

Starting a business is no walk in the park. In fact, the number of new businesses that fail exceed the number that succeeds. That’s why it’s more important than ever to create a unique product or service that helps you stand out from the rest. According to statistics, about seventy-eight percent of small business startups survive the first year and about half of all employer establishments survive at least five years.

You may have started your business for the wrong reasons. The right reasons for starting a business which leads to building a successful company include these:

You have a passion and love for what you’ll be doing, and strongly believe that your product or service would fulfill a real need in the marketplace.

You have the drive, determination, patience and a positive attitude. When others throw in the towel, you are more determined than ever.

Failures don’t defeat you. You learn from your mistakes, and use these lessons to succeed the next time around. They consider failures as a “learning process.”

Not Investigating the Market. Your desire to open the agency blinds you to the fact that we’re in a down housing market and the area where you want to work is already saturated with agencies, making it very difficult to break in. You have to find an opening or unmet need within a market and then fill it rather than try and force your product or service in. It’s a lot easier to satisfy a need rather than create one and convince people that they want to spend money on it.

Leadership Failure. You will struggle as a leader if you don’t have enough experience making management decisions, supervising a staff, or the vision to lead your organization. Perhaps your leadership team is not in agreement on how the business should be run. Do whatever you can to enhance your leadership skills and knowledge of the industry. Examine other business best practices and see which ones you can apply to your business. A successful manager is also a good leader who creates a work climate that encourages productivity. He or she has a skill at hiring competent people, training them and is able to delegate. A good leader is also skilled at strategic thinking, able to make a vision a reality, and able to confront change, make transitions, and envision new possibilities for the future.

Insufficient Capital. New business owners often don’t understand cash flow or underestimate how much money they will need for startup and they are forced to close before they have had a fair chance to succeed. They also may have an unrealistic expectation of incoming revenues from sales. Be realistic at the beginning, and start with enough money that will last you to the point where your business is up and running, and cash is actually flowing in. Use professional business accounting software to keep records of all financial transactions, including every expenditure and all revenues received, and use this information to generate profit and loss statements.

Challenges in E-Commerce

Back in the day, you can sell just about anything and make crazy money. Competition was minimal, technology wasn’t as affordable as it is now and access to product was limited. Now, Amazon is a major competitor to everyone.  China is opening up to the world and technology is now affordable. The e-commerce industry has become so fierce, that surviving has become a matter of concern. With internet fostering the birth of many newcomers threatening reputed players, the need for differentiating on the basis of customer service experience has become as critical in modern times. This article will discuss a few e-commerce challenges that players face. The information here is based on research by Cyriac(2015) and Assan(2017).

Challenge #1: Lack of Verification Measures

Once a customer signs up in an e-commerce portal, the portal is unaware about the customer except the information he/she entered. The credibility of the customer is questionable. This heightens when the customer issues a Cash-on-Delivery (COD) purchase because the business is unsure whether the customer is genuine or not. These have resulted in huge revenue losses for many e-commerce players.

Challenge #2: Selling the Right Product

Shopping cart platforms like Shopify have eliminated many barriers of entry.  Anyone can launch an online store within days and start selling all sorts of products. Amazon is taking over the eCommerce world with their massive online product catalog.  Their marketplace and fulfillment services have enabled sellers from all over the world to easily reach paying customers. Let’s not forget about Aliexpress.  They’ve simplified product sourcing by giving access to Chinese manufacturers within a couple of clicks.

All of this has made it very difficult for retailers to source unique products unless you they decide to manufacture your own.

Challenge #3: Product Returns and Refunds

When products are returned because customers are unsatisfied with the product, it scars the business with heavy loss on shipment and reputation. Cost of logistics have always been an issue for e-commerce players especially for those who deliver for free.

Challenge #4: Customer Loyalty

E-commerce industry is an industry where the cost of switching is pretty insignificant. A lot of players have lost customers because their rivals have a better quality of customer service, or better discounts. Knowing that 86% of clients stop doing business with a company because of poor customer service, you need to ensure customer service is always a priority for your online business and part of your retention strategy. Customers demand consistent and seamless experiences across all channels, and players that refuses to deliver fail to retain customers.

Challenge #5: Achieving Long Term Sustainability

Increasing sales is one way to grow the business but in the end, what matters most is profitability. Online retailers must always find ways to cut inventory costs, improve marketing efficiency, reduce overhead, reduce shipping costs and control order returns.

Challenge #6: Choosing Right Technology and Partners

Some online retailers may face growth challenges because their technology is limiting them or they’ve hired the wrong partners/agencies to help them manage their projects. Retailers wanting to achieve growth must be built on a good technology foundation.  They must choose the right shopping cart solution, inventory management software, email software, CRM systems, analytics and so much more. In addition, hiring the wrong partners or agencies to help you implement projects or oversee marketing campaigns may also limit your growth.  Online retailers must choose carefully who to work with.

Increase Conversion: Most Effective Way

Having an online store means you need an online platform to easily manage and move money online.

PayPal is the most convenient payment option for your potential customers, the transaction fees may weigh a little burden, but the checkout conversion rate feature of PayPal helps online retailers and sellers.

As PayPal made the checkout experience simple, easy, and quick, results came that there is higher conversion rate and higher online sales.

Did you know that 69 percent of those who shop online, abandon their e-shopping cart? The statistics have shown that 3 out of 4 shoppers do not complete their purchase and abandon their e-shopping cart. The shopper may have numerous reasons why they do this, but the main reason is the more clicks and keystrokes it takes to check out, gives more opportunities for the shoppers to change their mind.

Thus, PayPal speeds up their checkout process. They auto-populate the shipping and billing information, thus the crucial clicks and keystrokes from the checkout process are eliminated.

More than that, PayPal gives the shoppers the confidence in their purchases by providing a reliable, and trusted payment method.