The Internet has come a long way – a few years ago, it provided an extremely limited selling venue. Only the most daring buyers ventured online to make purchases. Today, nearly anything that can be sold can be sold online. Even the most conservative shoppers think nothing of buying a complete set of furniture over the Internet.
Asking the Right Questions
So with almost unlimited options to choose from, how do you select the right product offerings for your E-Biz? What factors should you consider? We recommend asking yourself five specific questions before determining what merchandise to sell:
Before investing in a product, it's critical you consider how well it will do online. Look at whether you can be profitable with an item, and whether or not that profit justifies the workload that selling it demands. What you sell is one of the most important decisions you'll make in your E-Biz. The online companies that excel, are the ones that take time to ensure they have a successful product mix.
- Can I be profitable with this product?
You need to know, not just the cost of sourcing an item, but the total cost of selling it, because some items have hidden expenses involved in selling them. Packaging, shipping, storing, marketing, and maintaining listings for your wares are all a part of the total price of selling.
- What's the demand for this product?
Before you sell an item, you need to know if anyone is searching for it online. There are a number of research tools out there that you can use to determine if there's sufficient demand for your goods. Like our Market Research Wizard that is built into our Product Sourcing Tool.
Note: Many new sellers want to source high-demand "hot" products – but these often produce too much competition to leave room for good profits. Finding medium-demand, niche areas is a more stable option than chasing down every "hot" product on the market.
- What purpose does this product serve?
Every item plays a different role in your overall selection. Some have lower margins but are easier to sell or generate more traffic and are, therefore, worth carrying.
- How complicated is this product to sell?
The time and effort you put into selling a product is part of your total profitability equation. Customizable items may have high margins, but if you can only produce a few because it takes too long, the profits may not justify the hours and energy you'd invest.
Many items also have unique parameters. Some require detailed explanations and diagrams or necessitate a greater amount of customer service. Others, such as perishables, have special storage and shipping needs. These extra tasks can add up to a lot of your time and need to be taken into account.