|
7. Company Structure - What Type of Business
Retain professional advice on how you choose and proceed. In the UK you can choose to be a Sole Trader or Limited Company It is straightforward to become a Sole Trader but remember you are personally responsible for your business’s debts. A Limited Company’s finances are separate from your personal finances, but there are more reporting and management responsibilities. [https://www.gov.uk/running-a-limited-company] Register your business with Companies House or the relevant authority in your country. In the USA and other countries, there are different rules and different options. e.g. registering an LLC.
0 Comments
8. Online Selling in the UK
Before an order is placed You must provide:
Right to cancel You must tell the customer they can cancel their order up to 14 days after their order is delivered. They do not need to give a reason for cancelling. If you do not tell the customer about their right to cancel, they can cancel at any time in the next 12 months. If you tell them about the right to cancel during these 12 months, they have 14 days to cancel from when you told them. There are different rules for downloads and streaming services. [https://www.gov.uk/online-and-distance-selling-for-businesses/online-selling] After an order is placed You must:
9. Branding
When establishing your brand identity, consider:
Types of Brand Names:
When choosing your brand name:
The Formations company help with creating a name Domain name It is imperative to have a domain and presence on the internet. The best urls ends in a .com. Domains (URLs) can be purchased through:
Email address: You will need a professional email address based on your domain name. (Not just a gmail or yahoo address). Graphics: You will need:
You could use AI or go to a graphic design company or find freelancers to help you at: fiverr. Tailor Brands provides packages with tools to help you start your business and appear professional. [https://www.tailorbrands.com] 10. Choosing the Product (Service or Course):
I will talk specifically about products, but these principles equally apply to you providing a service or course. When deciding on the product/s you want to sell choose a market and identify 5 niche markets that really interest you. Dig down into the niche until it is very specific and that you can describe it in detail. e.g. home décor – scented candle making.
Generally, there is almost always a market for health, wealth and relationships. Markets and their niches of e-commerce are broadly:
Research the latest Trends connected with your niche. Look at reviews and note the common complaints and as well as the common compliments. Research on blogs, Facebook groups, Pinterest and Instagram reddit and YouTube. Check out competitors. Buy their product and determine why you bought it. Look at where it was sold an advertised. Look at indirect competitors. These businesses sell complementary products to yours. These can be very valuable allies in the future who you might collaborate with and market jointly to both your benefit. Make sure your product is of a high quality. 11. Trends
Tap into the zeitgeist. The spirit of the times. Plan for the future. Great websites to help define the latest trends are:
12. Competitors
You need to know about your competitors.
13. Designing the Product
If you decide on selling a ready-made product the key thing is to research who your market is and what your pricing will be like. But you may wish to design your product and make it or then have it manufactured. Design is often the most time-consuming part of the e-commerce journey. Creating the designs / patterns / artwork and then using 3d to see what the product looks like. However, it is often the most satisfying and creative of all the processes and keeps the designer coming back to design more. A word of caution - Infringing copyright. Be careful to use your own personal and original designs and artwork - the expression of an idea. It is easy to drag things off the internet and copy them, but this is illegal and undermines the original designer’s business and work and is very demoralizing for a designer whose work has been stolen. 14. Trademark
You need to protect your brand. Registering a trademark is one way to do this. How to obtain a trademark:
15. History of the Product - One Digital ID:
There is a move by brands and manufacturers to record digitally the lifecycle of how a product is made and where its materials come from. These can be captured in a QR code which link to information web pages in the cloud. This project is called Eon. [https://www.eon.xyz/] Customers can interact with this information and read about the authenticity, origin, services and even storytelling of the product they have purchased. 16. Manufacturers
Choosing your product goes hand-in-hand with finding a manufacturer. You could make the product or create the service yourself or you could outsource the manufacture of the product. Deal with manufacturer and not the middleman trader. Find and compare prices and quality from at least 3 suppliers. When approaching a manufacturer remember to ask about MOQs. M.O.Q’s Minimum Order Quantity. Remember to research this before you order as minimum quantities can raise your costs substantially and then you may be stuck with stock you cannot move but have to store. There are companies who will make low quantities some even will make one-offs. The reason manufacturer’s often have MOQs is it costs them less to make a number of the same item and thus the order becomes more profitable the higher the number of orders. There is less waste of material as well and better use of staff time. One major disadvantage with inventory and m.o.q’s is that your capital is tied up. You have to store the inventory and if it does not sell this is a very unsustainable environmental model. If you want to develop your brand ask if the manufacturer can provide a Private Label service where only your brand name appears on the product. This is exclusive to you. Under a White Label agreement a manufacturer can sell the generic product it makes to many different retailers. You will need to get samples made which will have a cost factor involved. If you look for local manufacturers you will save on International shipping and the potential delays that go with that. It is much better for the environment to manufacture locally. 17. Dropshipping
With dropshipping the supplier handles the manufacture, fulfilment and shipping. You will find the customers. A great advantage with dropshipping is that you do not have to purchase the product in large quantities. When researching your supplier, make sure you read the reviews and check that they are a legitimate and reputable business. Find out what the quality of the product is like. You can check this yourself by ordering a product that you can feel and touch. Rather use a manufacturer, as opposed to a go-between, who would take a cut. Dropshipping with countries that manufacture goods far away will increase your shipping fees and shipping times as well as potentially have more logistic problems (remember the Suez Channel container ship that ran aground and held up over 300 other container ships which caused world trade traffic delays for weeks in 2021). 18. Audience
It is essential to identify your audience and who you are talking to. Consider:
It is widely accepted that the following Western demographic generational identifiers separate ways of thinking and operating in the world as well as their buying habits and are often considered as target markets.
Consider what medium will you communicate with your customers i.e. social media, newsletters, advertising. 19. Pricing your Product (or Service)
Consider these general principles when pricing your product.
In order to price your product, you must take the following costs into consideration. 1. Variable Cost Considerations These costs relate directly to your product and having your product made. Consider:
2. Profit margin: Set the profit margin on top of the Variable Costs. This is often known as Cost Plus Strategy Pricing. The profit margin is the percentage of the sale that is your profit. Target price = (Variable cost per product) / (1 - your desired profit margin as a decimal) Take your total variable costs and divide them by 1, minus your desired profit margin expressed as a decimal. So, for a 20% profit margin, that is 0.2, so you divide your variable costs by 0.8. 3. Fixed costs These need to be factored in. For example, insurance, rent, licences, employees’ payroll. Review your pricing regularly. See Cost Analysis (LINK) below as an ongoing strategy to assess your businesses prices and profit margins. Remember to consider cash flow. You need this to keep the business ticking over. Compare your price to your competitors’ prices and marketplace trends and consumer spending. Adjust your pricing accordingly remember that you need to make a profit to remain in business. Incentivise your customer to buy more than one product by discounting on more than one purchase. This will often work in your favour as some suppliers will incentivise your prices in the same way for you if you buy more than one product. Compare different manufacturers prices. Consider your bargaining power with your suppliers. Consider which pricing bracket you want to fit in. Higher Pricing Bracket: Upmarket – pricing different. Be careful not to under-price. Your market is looking to improve or confirm their status. Have a unique product not available elsewhere. Creativity has a value. Lower Pricing Bracket: Competing in the lower pricing bracket – usually something ready-made and available elsewhere. Pricing is key. Beat your competitors on pricing. 20. Sustainability
This is your investment in the future. Sustainability is now being considered as an indicator of good management of a company. Many of your customers will share these beliefs and feel your company aligns with their values. Sustainability has a large societal impact. It relates to how your business affects the local and further afield community. It impacts your financial sustainability. Try to follow compliance standards often set up by environmental organisations. Sustainability has a positive brand association and good publicity and will attract customers who have similar ethos. Aim to consider the following:
21. Photography of the Product People want to see pictures of your product both in detail and in a setting. If you cannot afford to use a professional photographer, you can get a good result even using your phone camera. Make sure of the following:
The images here are from the luxury online store Long Studio Design.
22. Product Packaging
You must communicate your brand logo, message, fonts, colours and feel in all your packaging. Tinybox [https://www.tinyboxcompany.co.uk/] is a manufacturer where you can buy as few as 1 piece. They will brand packaging as well. 23. Unique Product Identifiers
GTIN, SKUs and MPNs Unique identifiers such as GTIN, UPC, and EAN and MPN are created to easily and quickly identify a particular product or part of a product. GTIN: More and more companies are requiring their trading partners to use GS1 standards to help move and track goods through the supply chain. If you are trading with Tesco, Amazon or other retailers, you may have been asked to create a GS1 logistics label with a Serial Shipping Container Code (SSCC) for your shippers. Google requires this or a MPN for Google Shopping. GS1 [https://www.gs1uk.org/] GS1 are one of 116 neutral, not-for-profit, and independent GS1 organisations operating across 150 countries. They provide products from barcodes to patient wristbands. “GS1 is the only authorised provider of Global Trade Item Numbers (GTINs) – the number you see under the barcode (also known as an EAN or UPC) that’s unique to that product. Our GTINs and barcodes are used and accepted by retailers and marketplaces across the world – making it easy to sell your products anywhere.” SKUs: An SKU is a Stock Keeping Unit (Pronounced ‘skew’). These are allocated by the product designer/manufacturer to each individual product to easily identify it when tracking inventory or searching for an item accurately, Tracking lot and batch numbers allows one to keep watch on quality control, service and warranty management and to help isolate production faults. No two products should have the same SKU. Even variants such as size, colour etc should have separate SKUs. When creating SKUs, the following three principles help to create them easily.
When creating the SKU number try to:
MPN: MPN stands for Manufacturer Part Number. Manufacturer part numbers are used as an unique identifier to find specific products. 24. Shipping
Consider free shipping. Free shipping is an invaluable resource to allow sales to complete. Many customers are put off by extra shipping costs at check out. If you do charge extra for shipping make sure you communicate this on the product page or earlier. Make returning goods easy. Couriers (often based internationally) and your Country’s Local Postal Services:
25. Inventory
An ideal business model is made to order. Advantages: The benefits are that you do not hold inventory and there is no wastage and there is the possibility that your goods products can be sent directly from the manufacturer to the customer thus eliminating and extra shipping fee to you and your warehouse. It is a very sustainable way of working and good for the planet – no wastage and less shipping Disadvantages: You are often beholden to your manufacturer and their ways of working It is much more expensive a model and your pricing has to reflect this However, this is not always possible and if you are selling through a marketplace they will doubtless require you to hold inventory so that the products can be shipped within a day or two to the customer. Try to have a back up supplier as depending on one supplier can affect your business negatively if things do not go smoothly. Lead time – are your customers willing to wait for the lead time. Often they will as they realise that this is a very sustainable method of operating. Principles of inventory:
Manufacturers can be unreliable. Lead time this time between restocking and selling out your existing stock needs to be carefully monitored. Real time inventory management software Radio Frequency Identification (RFID) allows warehouses, factories and retail stores to keep live track on where goods are and how many of them are in the inventory. RFID uses a microchip which can include information such as type, manufacturer, serial and GTIN numbers and send this information to a collection device. Barcodes readers update the databases. This real time information has created more accuracy in planning and costing of goods.
27. Product Descriptions
Try to immediately hook the audience. Writing a description of each product. Do not repeat your descriptions. Google does not like repetition. They look for compelling original content.
Jasper AI [https://www.jasper.ai] 28. SEO
SEO or Search Engine Optimisation are the rules created by Search Engines to help put your website in front of and higher up the ranks of search engines like Google [https://Google.com], Bing [https://bing.com], Yahoo, Amazon, DuckDuckGo and Ask.com. The search engine analyses and reviews your website by ‘crawling’ with bots and then indexing your content to decide where you should be ranked in search listings. The algorithm and rules of SEO keep changing by Search Engines, but here are the fundamental points that are seen to be more consistently constant:
SEMRush is a SEO tool website where you can track keywords, site audits and competitive insights. Their program is called BeRush. 29. Strategic Partners
Keep a directory of details about your manufacturers and potential manufacturers and suppliers, where they are, their contact details, MOQs etc. Follow GDPR rules for storing details. Use an Accountant and Solicitor where you need expert help. 30. Wholesale
Wholesale partners are a means to you reaching a whole new and broader audience. Advantages: Benefit of other people doing your marketing for you. Disadvantage You profit margin is reduced. Remember your costs are critical.
31. Marketplaces
Other platforms and selling your products. Price for their fee and cut. Often a percentage of sales + a monthly subscription. |
Author
Archives
October 2023
Categories
All
|
RSS Feed
Copyright © 2024 Rose Long. All rights reserved.