How to Make Money with E-commerce
5 Tips for making money selling products online
So whether the aim of the e-commerce store is to supplement income or a primary business the motivation and goal is to make money. Although this may be the desire of every online entrepreneur it is not as easy as just setting up an online store and waiting for the sales to roll in; this will lead to frustration and a lack of customers. There are a few crucial elements that you need to consider in order to make a success of the enterprise. Underlying all of these is the foundation of time and effort, there is no substitute for this but we can give you a jump start with our list of tried and tested ideas.
1. Be Aware of your Profit Margins
This is one of those tips that provides the foundation for making money in any business; it is a crucial element for profitability. You need to be aware of how much money is being made per product per sale. This provides the basis for all other financial decisions in the business such as how much to reinvest and pay yourself. Calculating profit margins are not tricky and the same formula can be applied to every product you sell no matter how different the items.
2. Controlling Inventory
By ensuring that you have the right amount of inventory you secure your cash flow as finances are not tied up in products that can take time to sell. This allows for capital to be used in the operation of the business or kept for a business rainy day.
In order to keep the optimal level of inventory you need to understand your business as there is not a quick formula to figure this out. The correct inventory levels differ from product to product and business to business. Ideally, you should know how often a product sells and how often it sells compared to the other products. Then you can figure out how long your stock will last and combined with the business costs you can determine optimal stock levels. If this is sounding too complicated you can always consult a sales enablement company who can assist with this aspect.
3. Publish a Blog that Generates Traffic
The motivation behind this advice to create a successful blog is to get enough traffic to the business website. Another way to get customers to the store is to rely on paid advertisements but this tends to be costly and can negatively affect your profit margins. It may take more time to develop a successful blog that generates sales and improves your rankings in search results but it has greater benefits. The key to having a successful blog is to be active and create content that is tailored to the customer; helps customers find what they are looking for or addresses their questions or problems.
4. Automate, Automate, Automate
The more the e-commerce processes can be automated the better; it will result in faster and easier growth. Although this may take more time in the beginning it will reap benefits in the long run. Some of the processes that can be automated include accounting, order fulfillment and marketing. By automating these it frees up time for you to undertake other growth activities that require a human touch such as publishing blogs.
5. Understand and Use Search Marketing
Search Engine Optimisation might sound very technical but it is a great tool for growing an e-commerce store and therefore increasing your profit margin and making money. Before launching an e-commerce enterprise learning about SEO and keywords for your specific industry will significantly help especially if you will be using platforms such as Amazon. An industry specialist can help by providing Amazon sales support in this regard.
There are huge market opportunities in the world of e-commerce but it requires time and effort in order to make the most of them. If you have a great product and keep these tips in mind then you are one step closer to being successful and the possibilities for profit are endless - especially given that more and more customers are moving away from offline shopping and becoming online customers.
How the London Bridge Project Can Help to Deliver Success
The London Bridge Project (LBP) is a leading sales and management consulting firm that provides both amazon consulting services and amazon sales support for businesses looking to grow exponentially within the biggest marketplace in the world. We offer a complete end-to-end service for Amazon based businesses, which includes providing valuable insights into Amazon sales data and a pipeline of under-explored opportunities within your niche.
If you would like to learn more about how the London Bridge Project can help your online business, make sure to contact a member of our team today to discuss your requirements.