When it comes to making money online, starting an online business is a great way to go – and of all the various options available, selling products is perhaps the most accessible option for entrepreneurs.
The problem really, is figuring out two vital points: What to sell and how to sell it…
How to sell online
If you try to sell the same products as your competitors, with the same prices and no USP you are facing a hard time. Think carefully about what you can do to entice customers away from the established competition. “Why would anyone come and buy from me instead of my established competitors?”
Figuring out what to sell depends on how you are going to sell it. Some avenues won’t bear certain products as well as others.
For example, you could sell stuff on eBay – but eBay is a place for bargains, so your business model will have to be about finding and selling discounted items.
If on the other hand you want to sell products at their retail price, you will probably need a very nicely branded website and a good marketing budget. You will also need to figure out your USP (unique selling point) – because chances are there will already be plenty of other companies selling what you want to sell.
What to sell online
So let’s go through the options then. What can you sell?
Option 1: Be a discounter
This is the easiest option really, you are competing on price, so if you can keep them low you can probably make some sales. The downside of course is that your margins are squeezed, so you have to make sure you control your costs. And if this isn’t the business for you, why not consider some other money making ideas?
Key Skill: Finding discounted products
The key to this business is finding products at the right price. This is not always an easy task…
One option is eBay – buying wholesale lots to break up. Retailers who are closing down will often sell off their stock in bulk for savvy entrepreneurs to snap up.
You could consider going directly to high street independent retails and offering to buy up all of their end of season stock. They are likely to appreciate the extra cash and shelf space and they would probably rather be focusing on their new stock anyway.
Make enquiries both online and off. Make sure you ask people what is available. The best deals are often the ones that are not advertised. Hanging around in forums where retail shop owners hang out is a good idea. If you ask around you can find some awesome deals and opportunities.
Option 2: Be a retailer
If you want to retail stock you will never struggle to find stock in the majority of niches – the retail business is all about making sales. As I mentioned above, the key is finding your USP. The internet is littered with the remains of start ups whos founder thought “If I can just get 0.1% of the market”.
Key Skill: Getting people to buy from you
Firstly you are going to need some marketing. This in itself could make for a USP, but your competition probably have deeper pockets than you do, so don’t rely on it.
One good business model is SEO – unfortunately it takes a while to get going with. The trick is to be in a fairly uncompetitive niche where you can be a one stop shop – offer every type of product you can and pick up lots of long tail traffic.
The alternative is using paid advertising such as Google Adwords. If you choose to go down this route your website will need to have something special that makes it better than all the other sites advertising on there – especially since you will probably have less stock than they do, and a weaker brand.
Option 3: Be different
This is an interesting option. If you are selling unique products then you effectively have no direct competition. Conversely, you also have no direct demand. This sort of business lends itself well to craft type businesses and bespoke items.
Key Skill: Creating demand for your product
There are two ways to go with this; if you are the arty type, you can set up a small shop selling your own querky products. Or if you are the entrepreneurial type, why not source unique products from other artists and creative people to sell online. You can even offer to do it on an affiliate commission basis to save on capital outlay.
Because these products are unique, people will not already be looking for them, so traditional marketing avenues might not work. Your biggest weapon in this business is social media.
You need to hang out in the places that your potential customers might be hiding. Home improvement, craft or lifestyle blogs for instance (do some guest posting). Facebook and Twitter are also great places to spread the word.
The brilliant thing about this business is that if your products are good enough, your customers might just go an spread the word for you. The challenge is finding those products that have the x factor…
Summary
Not really a lot to summarise for this post; The idea is simple enough though, pick one of the three options above, spend some time thinking about how you can make it work, and sign up for my newsletter for regular help and advice. And if this isn’t the business for you, why not consider a few alternative money making ideas instead?