Should you put a store online?

Whether you have a physical location and want to expand to the internet or want to start from scratch online, the success of your venture depends on the previous analysis of some factors, explains Karla Covarrubias, specialist consultant in e-commerce.

No one doubts that the growth of e-commerce both globally and in Mexico represents an attractive opportunity for small and medium-sized enterprises, but entering this sector is a decision that needs to be analyzed.

One of the simplest ways to ensure business failure is to start without a business plan and an online store is no exception, regardless of whether you already sell in a physical location.

“The implications of an online store are the same as those of a physical business,” said Karla Covarrubias, specialist in eCommerce Advisors Bureau (Ecab), a consulting firm specializing in the creation of strategies for online commerce and the training of entrepreneurs.

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“The success of an online store, like any business, has to do with planning,” he said.

Product
In the first instance you should investigate if the product or service you offer has demand in your market. You should also analyze what your niche will be and who your competitors are, so you can differentiate yourself from the thousands of options that already exist on the internet, including giants like Amazon, who lead the way in terms of costs and logistics.

Whether your product is very exclusive or your level of service is the best in the market, you should look for that feature that will make you stand out. Even if your products are similar, you can shine by offering your customers related information in an attractive and easy-to-understand way.

Clientele
Also study what your target audience is. Do not assume that you will serve the same customers as a physical store, because the universe of potential buyers is very broad on the internet and you must know who you are looking for love to direct your strategies correctly.

Fixed costs
“Just like the rent of a local, the online store also has its fixed costs,” explained Covarrubias. Your basic internet income includes the registration of your domain on the internet and the hosting service.

Store Development
Whether you approach an agency to develop your entire store or have someone inside your company that does, you should take into account the commissions charged by e-commerce platforms, which may be a percentage of your sales and A fixed monthly payment.

In addition, you must take into account the cost of taking the images of your products, which should be as clear and attractive as possible, together with the texts you use to describe your articles, are the only way for the customer to know your product.

Financial aggregators
The processing of payments in your online store is another cost to calculate and, when choosing the service, you must pay attention to the commissions that charge you and if in addition to card charges, they offer to receive payments in convenience stores or Bank deposits. The financial aggregator must be registered with the Bank of Mexico and must be supervised by the National Banking and Securities Commission.

Customer Support
Failures in customer service are the main reasons why a store, online or physical, fails, so you must designate the people who will take charge of this activity.

Keep in mind that your buyers expect quick answers, especially on social networks.

If you have a “happy problem” as your demand for your products goes beyond what is planned and you offer a bad experience to the customer, for lack of answers or attention, you can lead to failure all your effort, explained the specialist of Ecab.

Logistics
Keep in mind the storage space you will need and the staff needed to process and pack the orders you receive. You should also analyze the cost of different shipping companies and locations to verify that they match your target market.

“The success of an online store is behind the scenes,” said Covarrubias, because even if the site is well done, if the experience you give the customer is not good, he will not return.

Cost effectiveness
Since you have the analysis of your market and your expenses, it is possible to identify if your enterprise will be profitable and in how much time.

If the expenses that result in your business plan are currently unaffordable, it is best to seek to capitalize before you start, or by allocating part of your income to savings before you start.

Another option is to seek financing through credit, but you should always take into account your actual ability to pay.

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