Starting an e-commerce business can seem a bit daunting, but it really doesn’t have to be. I have come up with some great guidelines and tips to help you start and successfully grow your ecommerce business. These are my tips on how to create a Shopify, Woo Commerce, Trexecom, or any other type of online store.
Why Start in Ecommerce
There are so many reasons why people want to start an online store. They can be:
- to share your passion about something with others
- help others solve a problem
- make a little extra money
- quite a full-time job and be your own boss
- As a hobby (more on this later)
- Financial freedom
- And much more.
While all of these reasons are very valid, you may have your own reason for wanting to do it. Again, I have chosen to give you some of my best tips to help you. Doing these will give you the best start to your business.
Choosing your Niche
Once you know why you want to start an online business, then you can delve into what you want to sell. I don’t mean what product, but instead what area or general group of products you want to sell. One important part of this is making sure you have an audience in mind! This is so important let me say it again. Make sure you have an Audience in Mind!
Many people will say a niche is a group of people. Some will say a niche is a group of products. Well they are both right and wrong. A niche is both. It is a group of people that are interested in a particular thing and the items that surround it.
Let us talk about aquariums, I am a fan myself but don’t have any websites focused on them, yet. There are many parts to the aquarium hobby that would/could be included in the niche. Actually, aquariums would really be a very broad topic. I would suggest narrowing it way down.
You could look at freshwater aquariums, or salt water aquariums. Even then you could focus on large aquariums, small aquariums. Then community style tanks, species specific tanks, or even predator tanks. Really the list goes on and on. If you continued down this path I would suggest focusing on a few key aspects of products first, such as filter equipment. Then you could build a business and branch out into other aspects of the hobby.
Now keeping the audience in mind you can focus on top end products, midrange products, or even low end products. Just make sure you are talking to your audience. This is just like blogging. In fact I would suggest to blog on your ecommerce site, but we will talk more about this later.
You wouldn’t want to talk about the virtues of having a saltwater protein skimmer to a freshwater hobbyist. You wouldn’t sell very many of them, if any at all. So keep your audience in mind.
Naming Your New Business
There are two schools of thought on naming your business. The first is using a keyword rich name. Such as Better Aquariums. The second would be a brandable name. Think of companies such as Apple, GE, McDonalds. Do any of them actually have to do with their product. Apple is a fruit, not a computer or a phone. GE is a huge company but does it only have to do with Electricity? No, it doesn’t. Finally, McDonalds famous for burgers and fries. But does McDonalds name have anything to do with burgers or fries? No again. This is the difference between brandable and keyword rich names. Now they can be both such as Bed, Bath, and Beyond.
Picking your name for an ecommerce store, I typically go with a brandable name. Just start thinking of something easy to remember, easy to spell, and that does not have a negative connotation. Ultimately it is up to you!
There are several different things you should consider for different reasons. Having the correct legal structure can save you money as well as protect your personal assets. I will go over the basics of them here, but really you should check with your local tax professional or attorney to see what is best for you. One thing I will say is to make sure you keep your business and personal accounts SEPARATE!
The first and easiest one is the Sole Proprietor. This is where you are the sole owner of the business and your personal assets may be at risk. It is taxed the same as an individual. Many people start companies as a Sole Proprietor at first then change to another structure as they move forward.
A Partnership is another very easy structure to form. In this case you share the liability of the company as well as the taxes. This is also a very common legal structure for a business.
A Limited Liability Corporation, also known as an LLC, is the first structure where you need to have filings and go through some extra hoops for the government. The benefit is that it limits your liability for your personal assets.
A Corporation is the last one I will discuss. There are many different structures within the umbrella of a corporation. The biggest problem with this is that there is double taxation on the income. First for the company then when you get paid. The biggest benefit is the personal liability or lack thereof.
While all of these are important to note and keep track of you should really do further research in each one of them. As I stated before many people will start out with a Sole Proprietor structure, or an LLC. No matter what structure you choose make sure you stay compliant with the rules of that structure. For example you need to file an annual report if you have an LLC. With a corporation you may need to file quarterly reports.
You should get an Employer ID Number (EIN) or Tax ID Number (TIN). This will help keep your personal and business structures separate. You can get either an EIN or a TIN, you only need one. They are the same as your Social Security Number, but for your business. By doing so you can help limit your personal liability. It really is easy to do, just ask your local tax professional and they will help guide you through the process.
Online vs Offline
Okay, many people will think that their online business is more like a hobby and don’t take it seriously. I think this is because the overall cost to start an online business is much less than an offline business. This is a BIG MISTAKE!
You really should treat your online business just like it is a real business. Think of it as if you just opened a brick and mortar store. It takes a lot of work, planning, and effort to make it work. It also does take some equity.
While it takes some equity to build a successful online business, it I nowhere near the amount it takes to build a store in the real world. This is what makes it so attractive to build an online store. This is also why ecommerce is growing so quickly.
Domain Name and Website
Now we are getting to the nitty-gritty, and this is where the fun begins. Remember at the beginning of this post we talked about your business name and your niche? We are making a full circle back to that now.
You should start looking at sites like Namecheap or GoDaddy for your website. Try to stick with a .com domain. Use your name, without any spaces plus “.com” and search for it. If it is available, you might want to pick it up. If it is not try abbreviations of your name. For example. If you wanted JewelAquatics.com and it wasn’t available maybe try JewelAqua.com, JAqua.com, or even JAquatics.com.
All of this ties into your brand. When you have a store, you want to build your brand. Building your brand helps with repeat customers. Repeat customers means more revenue with less costs. This means more net profits for you!
Summary of Part 1
I would love to make this one post but to be honest it would be way too big. So, I am breaking it up in a couple of pieces.
Ecommerce is growing very fast. People love to buy things online. If you find the right market and you can differentiate yourself from the competition then you will do very well. One way you can differentiate yourself is to follow your passion. This will allow you to be, well, YOU! Don’t try and be someone else. Don’t copy someone else. Doing so will show and people won’t trust you.
This business is all about trust. Set yourself up with a good business name and start building your brand.
Make sure that you have a proper legal structure in place, you can always change it later. Keep in mind the different structures have different rules. Remember to stay compliant with those rules.
Setting up your EIN or TIN is a great way to keep your personal assets separate from your business assets. It is really easy to do. Some venders may not work with you if you don’t have one! So, make sure you get it.
Treat your online company just like it was a brick and mortar business. This really is important if you want to grow and make good money. This includes planning, more on this in the coming parts.
When the time comes you can get your domain name and set up your website. To first-time Ecommerce people, I would strongly suggest using Shopify or Trexecom. You can read more on those by clicking on their links. More to come shortly so stay tuned.