There’s no better time than the New Year to re-evaluate your product sourcing strategy. You can’t look at your product sourcing in 2008 the same way that you did in 2007. Consumer trends cycle and change—you need to understand what buyers want NOW. According to seasoned trend-spotter Lisa Suttora, of WhatDoISell.com, there are five specific strategies you should be incorporating to see your eBiz succeed in the coming year:
• Niche Down
The first strategy is to source vertically, or focus in on your niche. Explains Suttora, “Online shoppers want depth of inventory and a selection they can’t find down the street or at Wal-Mart. Last year, the small online sellers who concentrated on their specialty and became the go-to place for their specific sub-niche, far out-sold the larger, more generic online stores.”
Rather than carry a few selections of many various types of lamps, try drilling down and getting specific with your offerings, such as kerosene lamps for power outages or natural lighting lamps for home offices. This allows you to leverage your inventory capital and marketing efforts. You can focus your product sourcing efforts, rather than investing in different product categories or attending trade shows for multiple industries.
• Don’t Limit Yourself
Use multiple supplier channels. Even though you’re purchasing in a narrow niche, you don’t want to limit yourself to only using one supplier, or one type of supplier. Various product sourcing methods bring different strengths to your business and provide you with different opportunities. Drop shipping is a great way to test out new products, while liquidation and overstocks provide excellent loss leaders and add variety to your lineup. Using different channels gives you a well-rounded supplier list, and the most diverse product line possible.
• Be Different
Regional Sourcing can give you a unique position in the market and eliminate a lot of competition. Look for products that are exclusive to your region, but that people from around the country might be interested in. While you don’t need to build your entire product line around regional sourcing, you can supplement your existing line with products that buyers in other areas don’t have access to. For example, if you sell decorative lamps, you might look for local artisans that make uncommon lamps. Unique products that have a story often go for a much higher price online.
• Share the Knowledge
Bundle information with products. Customers are reporting that they want more than just a product—they want to know how to use it. So create a tip sheet or small eBook, or find someone from a site like elance.com or craigslist.com to create one for you. For instance, if you sell special garden tools, you might buy some little books on Japanese gardening tools that people don’t know how to use. You could then sell your tools with the book telling customers step-by-step how to use them. By constructing a One-Stop Shopping experience for your customers, you’re adding value to your product and eliminating your customers’ ability to comparison shop.
• Be Proactive
Act on your knowledge. It doesn’t do any good to assimilate great suggestions and ideas on sourcing products more effectively, if you don’t actually implement the tips and information you learn.
Product sourcing is an ongoing effort. Encourages Suttora, “Don’t just think about it—take action. Put these things into play and get outside that box. You will be amazed at the kind of business you’re going to be able to build this year.”