In the current scenario, when the businesses are on the verge of shutting down, the ecommerce business has boosted up drastically. Most of the merchants and traders have decided to take the business online to get proper exposure. Hence, they are generally looking out for the number of ecommerce business ideas to survive in this environment.
The less they know, starting a low cost ecommerce business is not like having a leisure walk on the grass. It does have a certain process to be followed, several calculations to be made regarding the commission for the ecommerce platform, the registration process for your brand, gathering required data, percentage of tax deductions, etc.
The primary concern for all business owners and merchants is the budget in which they can carry out a fruitful business online. Hence, if they find that the budget is a bit low or the incoming revenue from the online business is quite low, they certainly need some cost cuttings for their business to cover up with the low income and more spending. You can also check out more business ideas from The Scope Buzz’s small business guide.
Not only selling a product on ecommerce platforms, but you can also opt for an ecommerce website development and provide a platform for the business owners and merchants looking out for ecommerce solutions.
In this blog, we will be discussing how you can effectively implement your ecommerce business idea without worrying much about the budget.
Ways to minimize the cost while starting an ecommerce business:
Let us discuss various points on how to reduce costs in the ecommerce business. These are as follows:
1. Selection of an ecommerce platform:
It is a tendency of any businessman willing to take their business online to opt for the best ecommerce platform for selling their products.
But not to forget one thing; generally, the best platform comes up with higher rates for the charges to utilize the platform. Due to these rates, the business owner either needs to increase the rate of the product, which can be unacceptable by the customers, or you need to lower down your profit, which can affect revenue.
Hence, choose such a product that you have to pay less taxes and choose the platform in such a way that you have to pay minimum charges for selling your product on it.
2. Minimize the product returns:
Generally, when a product is returned, the platform charges some amount to the merchant whose product has been returned, in addition to the shipping charges to be paid by the merchant. In this scenario, not only the product comes back, and the merchant gains nothing. He also has to incur the charges for shipping back as well as the penalty. Hence the merchant suffers a loss every time a product is returned.
The solution for this is the display of all the relevant information on the product on the website. The customer should not feel that he has been cheated off by not providing enough information. If there is sufficient information displayed, the chances of product returns will decrease.
3. Negotiation with the product suppliers:
Try reducing the cost of your product purchase by negotiating with the supplier or the wholesaler. You can negotiate with them in the case of the free shipping of the goods, discount on bulk purchases, upfront payment of the product to get some more time to pay the rest of the amount, etc. This cost cutting techniques depends on your relationship with the wholesaler.
4. Wisely spend on promoting your product:
Promoting your product online is a very good marketing strategy. It also has got effective charges as compared to physical marketing. But this doesn’t mean that you overspend your budget for digital marketing, getting in the trap of various offers and discounts for ad campaigns provided by the platform itself.
For this, you should have a check on the calculation of ROI (return on investment) before starting an ad campaign.
You can also go for comparatively less costly modes of marketing like affiliating blogs, posts on social media, etc.
5. Pack your product efficiently:
The cost of packaging also differs from the product. For example, if you sell clothes or any other smaller and easy to handle product, then you can pack your product with the poly bags provided to you. But if your product is fragile and is vulnerable to break, you need to include cartons and other protective layers of packaging like bubble wraps and white sheets for your product to be delivered as it was when packed.
Hence, it would be best if you chose the way of packaging your product. If the product received is damaged one, then it might not only cost you the product and its shipping charges in addition to the penalties from the platform. But also, the review and rating of the product will decrease, and hence it might affect the visibility of the product on the ecommerce platform.
6. Have a dominance in selling a few products only:
You might have observed the pattern of merchants, where a merchant sells only one or two products like mobile devices and accessories, etc. This helps in creating a monopoly over the products, which can also help in increasing your product ratings and reviews.
From the above discussion, we can conclude that even ecommerce business startup costs are high; you just need to study various methods on how you can reduce the overall cost and the budget of the business. Start today by applying some of the tips above and end up with as much money in your pocket as possible. All the best from The Scope Buzz Team!