Starting a business selling goods to people all over the world has never been easier, therefore many people are getting into the game. But just because everyone is doing it, doesn’t mean everyone is doing it well. E-commerce businesses have a failure rate of around 80%! And many fail because they don’t know what they do not know.
If you’re thinking about launching an e-commerce business, there are 5 crucial things you need to know before getting started that will have a direct impact on how successful the business is.
- Know your purpose: Why are you starting this e-commerce business? There are hundreds of t-shirt and apparel companies, so the “why” has to be significant enough to stand out from the crowd. When we decided to take on 1heart2lives as a client, it’s because we saw that their core mission of supporting the American Heart Association would help them stand out from the noise of all of the other t-shirt companies. That’s not to say your e-commerce business needs to support a cause to thrive; it just means you need to have a clear purpose that defines how your business is going to connect with customers.
- Know your marketplace: There are thousands of pizza joints in America, yet more open every day. Many of those fail, but a few of them manage to thrive in a crowded market. How? It’s because they understand their unique position in the marketplace. This holds true for any business: you must determine what unique offering your e-commerce business offers in the marketplace. The Argossy was built as a resource for cosplayers to get the materials they need to build the perfect cosplay; beyond that, it’s specifically geared towards the female demographic that is often overlooked in the cosplay culture. Knowing your unique offering in a crowded marketplace will help your business to grow.
- Know your taxes: Did you know that if you live in Georgia, but your supplier is located in Texas, you will most likely have to file a tax return in Texas? Many people jump into the e-commerce game not fully realizing the extent of the tax situation, and what all it entails. And if you have customers in all 50 states, you will have to deal with taxes in many of those states, even if you don’t reside there. Fortunately, there are some really great platforms out there, like Taxjar, that will help you keep track of it all.
- Know your funding: Launching any business is expensive, time-consuming, and labor-intensive. There’s a misperception that somehow an e-commerce business side-steps this reality because it doesn’t have the brick-and-mortar storefront to build out. But that’s simply not true. The average e-commerce business takes roughly 60 days before the first sale, and quite a bit of time after that before hitting profit-mode. Having access to capital, or a committed investor to fund the launch, aren’t just luxuries when launching an e-commerce site. They’re critical towards ensuring the long-term success of the business.
- Know your website: There are multiple platforms available to build your e-commerce site, but they are not all created equal, and they are not all user-friendly. We are partial to Shopify (full disclosure, we are Shopify affiliates), but that doesn’t mean it’s your only option. No matter what platform you choose, you will need a basic understanding of website design to get everything into place. Beyond that, many of the printing vendors will require you to prepare the digital artwork for your site and for them, which means you may need to know InDesign, Photoshop, and more. The most important thing to understand is you will need to have a solid base knowledge of design concepts, website functionality, and sales psychology to build a truly successful e-commerce site.
Starting any kind of business is challenging, but it is also rewarding! With the right vision and strategy, your business will thrive!