Sell Online And Profit.com

[Last updated Aug 5th 2009]

The Online Store is the most popular and widely used method to sell online because it emulates a physical store without it’s high cost. When you start an online store, it can help you sell to a much wider customers base. Customers are able to shop in the comfort of their own homes without the need of travel. Items can then be delivered conveniently to the customer’s homes or offices. Like most methods of selling online, you get paid before you make delivery.

In the following paragraphs we will go through the Pros and Cons.

When you Start an Online Store:

PROS

* You have your own online Real Estate

When you Start an Online Store it will allow you to claim your own Real Estate online. You are not part of someone else’s big website, where you are not prominent. For example, selling on eBay, you are selling a few products in a large collection of other seller’s products. It is similar to selling your line of clothing in a large supermarket (which carries many other sellers lines of clothing).

When you start an Online Store, all the items being sold within your store, is yours.

When you start an online store, you are in full control. You have full control to setup the right marketing message to communicate the strong points of your products and services and of every aspect of your online store.

You are also able to display your website the way you want, unlike some other methods of online sales which are very restrictive.

* Allows you to attract a bigger audience

Unlike other methods of online sales, (which you are limited to the visitors of that particular site). Setting up your own online store will allow you to target the vast numbers of general customers on the internet. You are not restricted at all.

* Scaleable as it allows your business to grow

One major advantage of an online store, there is no physical limit of how many customers you can serve. As your customer base grows, you can scale your Online Store to fit your business needs. A successful online store can serve hundreds or thousands of customers and even millions, operating 24/7.

* Allows you to give more information about your business to your visitors and give them reasons to trust you

When you start an online store, you will be free to add as much content and information for your customers. More importantly, having full control of your online store allows you to place the right information at the right place, thus greatly improving communications with the customer and allowing them to make more informed purchases. This increases sales. A properly designed online store will quell all the customers fears and answer all their questions.

* Allows you to give more information about the product, play around with factors that can increase conversion from casual visitors to customers.

One of the main factors when customers are deciding to buy, is Information. Providing the right information and enough of it is extremely important for sales. When you start an online store, you will be able to include as much information as needed. You will also be able to place this information in the areas of the site that would generate the most sales.

* Gives you a more professional look

When you start an online store, you will have full control over the look and feel of the site. This can ensure that design is consistent and intuitive throughout the entire online store. This will give customers the sense of professionalism.

* Makes you look like a “big” business (an e-commerce seller that also sells on ebay “looks” so much bigger than a purely ebay seller)

With the above points, it adds up to your company looking like a professional “big” business. With your own online store, you will also have your own domain name. This will allow you to have your own customized email address (sales@youronlinestore.com) instead of a free email address (e.g. penstore12314@hotmail.com).

Also, as mentioned before, when you start an online store, you have full control over the design look and feel of your site. Getting a good design will give your company a good “big business” look that fits your products and services.

* You can put in as many items you as want without paying listing fees

When you start an own online store, you are free to put up as many products as you wish. Unlike other services like eBay, every item you publish will have a cost.

* You can sell as many items as you can without paying value added fees

Starting an online store means you will not have to pay any fees when your products or services are sold. eBay takes a percentage of the sales.

Another great advantage when you start an online store is that it can run by itself. You can focus on other important aspects of your business! Although your store is operating 24 hrs a day, you don’t need to have alot of staff to man the online store (unlike a physical store), because the software takes care of all the functions.

* Establish your own brand.

When you start an online store, you get to establish your own brand. Branding is an important strategy. This allows you to promote your company. Your customers will come to associate your brand with you. They will come to trust you and your brand. They will inform or recommend their friends to buy form you, etc. You will be able to develop long term relationships with your customers. Through time, you will increasingly accumulate good, long lasting loyal customers. Look at the super brands like GE, Intel, Microsoft, Sony, Kellog, Black and Decker and Coca Cola. The general public has strong connections with these brands. They look upon these branded products favorably and would probably buy these branded products over that of an unknown brand.

Other online sales methods do not provide the above mentioned advantages.

CONS

One of the most difficult things to do when you start an online store is the setting up of the website.

1. First you have to get a computer programer to come up with the program and set it up. This could set you back thousands of dollars and will take months to get up and running. For very big companies, this is still the best way to go.

2. Now, you can buy a ready made online store for your needs. This will cost $1000 to $2000 and up. Then you’ll have to get someone to set it up for you the way you want. This will cost a few hundred to thousands of dollars depending on how sophisticated you want your website to be.

3. However there is now a very cheap solution to this problem. There are many companies that have come up with rental websites you can use for a fraction of the previous cost. For about $20+ a month and upwards, it eliminates one of the big problems to start an online store. Most of them allow you to cancel at any time. So upfront cost is low.
You can set it up like your own. It is your own website until you stop paying the monthly fee.

Check online and you will see a number of these companies. Study their features carefully and select the one that most suit you.

You have two more items left to setup when you start an online store. 1) Payment Gateway 2) Merchant account. Setting up a Merchant account and Payment Gateway may seem like a difficulty, but it is a very simple process. Most rental websites have already incorporated these functions. You have only to do your part by selecting the bank and payment gateway and submitting your applications.

Setting up your own online store beats all the other methods of  selling online, even more so now since the biggest obstacle, the start up cost (the website and it’s setup ) has been eliminated by much cheaper website rentals. However, we recommend you follow through this article and up coming articles on the pros and cons of the other methods of  online sales before making up your mind.

Not all people are suitable to start an online store. These people are running very small businesses that have much lower sales volume. eBay and other online sales methods are more suitable for these people.

If you are intending to start a small online sales business, eBay might be a more suitable sales avenue for you.

If you are sure that you want to start an online store, you have to get an domain name eg. www.yourstore.com. It is now getting more difficult to get a name that you prefer (or like) as most short and popular domain names are already taken. (Especially for “.com”). You have to be imaginative to get a name that is associated with your company name, products or services. If you think you need a domain name within 3 to 6 months, get at least one right away. Good domain names will be taken fast . It only costs a little more then $10 for a year. You can pay for multi-year subscriptions, but remember to renew it before it expires. Once you get a domain name and a website you can assign the domain name to your website. When viewers or potential customers click your domain name, your website appears. Remember you have to have an operating website to get approved for a payment gateway and a bank merchant account.

An Online Store site is of no use by itself. Potential customers will not be able to find you. You have to apply SEO (Search Engine Optimization) to solve this problem. The good thing about Rental Online stores is they have thought about this and incorporated SEO features into their services. You have only to input keywords of your products in it. We will get into more details in our Articles regarding Online Marketing.

Good luck with your Venture!

From, Sell Online And Profit.com

[Last updated Aug 5th 2009]

[Last Updated July 25th 2009]

In part 2, we will be covering the following methods:

6. Social Networking
7. Twitter
8. Mobile Phones
9. Selling through industry websites (like Etsy)
10. Email

We will now continue with the rest of the popular methods to sell online. Please refer to part 1 for the first portion of the list.

6. Social Networking

Social Networking sites like Facebook, Myspace (and other sites) have really taken off and become part of the internet fabric in the last two years. These sites enable members to share their news and pictures with all their friends online. Recent reports indicate that social networking sites now account for the most Internet traffic online currently.

As social networking sites are still relatively new, selling through these sites are still not quite established yet, but the potential is definitely there. These sites have millions of people visiting them every day and thus the potential customer base is huge.

7. Twitter

Twitter is an online service which allows you to broadcast your message instantly to (potentially) thousands of people at once. This service has gained sudden prominence in the last few months and is steadily gaining traction among the internet community and the main stream community.

Again, as with social networking, Twitter is quite a new service and sales through this service is still not quite established. But, with the ability to send messages to many potential customers, the potential of large sales is there.

8. Mobile Phones

Statistics show that there are about 255 Million mobile phone users in the United States (2008) and this number is growing rapidly. In years past, people used mobile phones primarily for conversations. With the introduction of smartphones (iPhone, Blackberry) usage of mobile phones have begun to shift to music, internet surfing, news etc.

As mobile technology advances, with better hardware, payment services and better ease of use, selling through mobile phones is quickly becoming a reality, with the prize being the millions of mobile phone users.

9. Industry Websites

Another method of selling online is through an Industry portal. The website caters to a certain demographic and draws consumers with similar interests. A good example of such a site is Etsy.com . This site enables users to buy and sell hand made goods.

Focusing on niches, industry websites can gain popularity from word of mouth and a thriving community of like minded consumers.

10. Email

One of the earliest and most effective methods of online sales is Email. It is because Email is still currently the most used internet service. It is also a service that most internet users truly depend on for daily communication.

It is because of the great effectiveness of Email Sales, that has resulted in the prolification of Spam emails. This turns many users off. But, if done right, Email can be one of your most powerful online and brick and mortar sales tools.

Above are the popular methods of selling online. In the upcoming articlies, we will go through each method’s pros and cons and how to utilize each method to Sell Online and Profit. In today’s online world, utilizing a combination of the above methods is the key to success.

Good luck in your venture.
From Sell Online And Profit.

[Last Updated July 25th 2009]

[Last Updated July 16th 2009]

If you have followed all the preceding articles carefully and have reached Articles 7, Congratulations. You probably have what it takes to be successful in business. Although there are more things you need to know from our up coming articles, you should start getting acquainted with the more popular was to sell online. Consider which is most suitable for you. Here we give a brief description of each one and how they work.
This article will provide a summary of the most popular methods of selling online and in the next few articles, we will delve deeper into each method.

There are many ways to sell online. You can setup your own online store, or you can an use existing online service to your advantage.

The popular ways to sell online are:
1. Online store
2. EBay
3. Yahoo
4. Amazon
5. Craigslist
6. Social Networking
7. Twitter
8. Mobile Phones
9. Selling through industry websites (like Etsy)
10. Email
In part 1 of this Article, we will explore the first 5 methods of online sales.

1. Online Store:

An online store is like a great hybrid of a physical store and a mail order catalog. It has the advantages of both. Like a physical store, Customers can browse your goods in a pleasing interactive environment and are able to place items in their shopping cart as they shop. It also has the advantages of a Mail order catalog. (please note that the online store has made the mail order catalog obsolete. only few establishments now use the mail order catalog{and doing it successfully}) Although, the online store concept has made the mail order catalog obsolete, it retains all the advantages. Customers are able to shop in the comfort of their own homes without the need of travel. Items can then be delivered conveniently to the customer’s homes or offices.

One major advantage of an online store, there is no physical limit of how many customers you can serve. A successful online store can serve hundreds or thousands of customers and even millions, operating 24/7.  The online store can run by itself and you can focus on other important aspects of your business! Although your store is operating 24 hrs a day  You don’t need to have alot of staff to man the online store (unlike a physical store), because the software takes care of all the functions.

Follow the articles in this blog and you will be on your way to setting up your very own successful Online Store!

2. EBay:

Launched in 1995, EBay has become the world’s largest online auction site. Millions of users buy and sell on EBay. EBay allows a large audience to view your goods and allows them to bid on your goods. The highest bidder will be allowed to pay for your item.

Recently, EBay has established fixed pricing service.

3. Yahoo Stores:

Yahoo was one of the first search engines and has grown to a massive online portal. Millions of people goto yahoo for their news, email, entertainment and much more. Yahoo utilized this large amount of visitors to launch Yahoo stores.

Yahoo stores allows users to setup a simple online cart and potentially reach a large number of Yahoo visitors.

4. Amazon

Amazon gained fame and success by being the world’s largest online bookstore. Millions of customers purchase their books with this online retailer. Amazon has recently allowed others to start selling some items on their website and tap into their large customer base.

5. Craigslist:

It is the world’s largest list of online free classifieds. Because placing a classified ad on Craigslist is free, it has drawn many posters and thus draws many customers.

It is also a very localized service where you can target customers from specific geographical regions.

For the rest of the Most popular ways to Sell Online, please stay tuned for Part 2 of this Article coming soon.

Good luck with your Venture!
From Sell Online and Profit.com

[Last Updated July 16th 2009]

[Last Updated July 7th 2009]

Rule 5. Calculate your Profitability

a. You must be able to calculate your profitability.

Profitability is the ultimate goal of any business. It is also yours.

The problem is most companies lose money. Many grind through day after day, with the owner wishing they could sell their operation and get out. Many close down due to losses. Very successful businesses are not many. This is not by chance. They know the right things to do, and did most things right.

We are hoping that this blog will help guide you do the right things.

One of the most important things to know is whether your sales plans can be profitable.

If you are about to start a business, we suggest you carefully examine your sales strategy.

If you followed the previous articles closely, you have done a good job till now. Please continue to do the same with the coming articles.

Following the previous articles, you now have selected good products. That is a very good move and you have started on the right track.

BUT! — Just having good products does not guarantee success. It is not enough. You will need to do much more.

This article will examine your profitability from only the sales aspect. Marketing your products will be detailed in future articles.

You may now have projected monthly sales volume for each of your products. Is that projected volume sufficient for profitability? You may need much higher volume to break even. In actuality, you don’t know the figure.

Most will say “I will sell as much as I can.”. This doesn’t work. You may over stock and tie up your money in stocks, or, under stock and not be able to meet your customer’s orders. Worse still, you may need a sales volume that you cannot achieve. This will lead you to continue losing money until your funds run out and you are forced to close your operation.

This won’t do. You need better information.
We will examine this topic now. Let’s take the pen example again.

Let’s say, you think selling 300 pens a month will make you money, and selling more than that is a problem. Let’s calculate together and see what will happen.

(The following figures are taken from article 5)
The selling price of the pen is $20.00
Your unit cost for the pen is $10.00
Your fixed cost is $5000 per month
Your variable cost per unit is $1.00

Let’s see if selling 300 pens a month is profitable.

Your net Profit or Loss will be:
1. Sales Price — $20
2. Unit Cost —— $10
3. (minus) variable cost $1
4. bal = $20 – $10 – $1 = $9 (Gross profit after variable cost)
5. Earning for 300 pens = 300 x $9 = $2700
6. Earning minus Fixed Cost ($2700 – $5000 = -$2300)
7. You now know that selling 300 pens a month will not be enough to make you money. In fact, you will be losing $2300 per month.

Now, relate the above example to your products. Do similar costings for each product. Find out how they fare.

For the above example, you have 3 options:

1. Cut your costs down (Fixed Cost, Unit Cost and/or Variable Cost), so you will break even at selling 300 pens a month. Or,

2. Increase your sales volume.

3. Perform a combination of the above 2 options, or do not start your venture.
Through the Product Costing calculation above, you will get information you normally will not have.

With Product Costing, you will have the following information:
1. Your break even sales volume. (Please refer to Article 5)

2. Will you be profitable at a sales volume you can comfortably achieve. (Please refer to the earlier paragraphs in this Article)

3. (If #2 is true) Are you happy with that amount? If not, do you want to start the business? Are there ways to increase sales volume to make the profit you are expecting? Yes. (We will cover these issues in coming articles. We will email you when they are published. Please subscribe to our Newsletter so we can email you when they are ready.)

4. At what sales volume do you achieve your target monthly profit? (You can achieve this by Product Costing)
To answer this question, let’s return to the pen example.
The selling price of the pen is $20.00
Your unit cost for the pen is $10.00
Your fixed cost is $5000 per month
Your variable cost per unit is $1.00
Your target profit is $4000 per month

1. Sales Price — $20
2. Unit Cost —— $10
3. (minus) variable cost $1
4. bal = $20 – $10 – $1 = $9 (Gross profit after variable cost)
5. Your Fixed Cost is $5000 per month
6. Your target Profit is $4000 per month
7. You have to hit your Your target Monthly Revenue = Fixed Cost + Target Profit = $5000 + $4000 = $9000 / month
8. Your Target Monthly Sales Volume = $9000/ $9 = 1000 pens per month
9. Therefore, to make a profit of $4000 per month, you have to sell 1000 units of pens monthly.

Apply the above calculation to your products. What are the results? (Remember, if you have multiple products, use the method on Shared Value described in Aritcle 5)

b. For existing online or physical stores, apply Product Costing to all your products. You will have a clearer picture of your entire operation. You will know which products make you money and which don’t.

Ditch those money losing products if you can. (But most times, you cannot as those products help you sell the profitable ones.)

Remember that you still have Sales/Marketing costs and Delivery costs.

Sales/Marketing:
Sales and Marketing doesn’t need to cost anything if you know the marketing methods to increase online sales. We will assist you in this area in our later articles.

Sales and Marketing is very important.
1. It increases the number of customers visiting your site
2. It gives you extra exposure
3. It places your website on higher pages in search engines, thus allowing customers to find your site easily.

The above points result in increased Sales Volume.

Please subscribe to our newsletter so we can inform you when the Sales and Marketing article is published.
Delivery Costs:

These are separate charges that are paid by the customer.

Remember that Delivery Costs should cover all costs:
1. Transport costs from your operation (factory, physical store or home) to the postal drop-off point and,
2. Full postage charges.

Also, check out the local and international postage rates. USPS (www.usps.com) will be the cheapest. Remember to also compare rates to UPS (www.ups.com) and FedEX (www.fedex.com). Their rates are higher and you might require their services from time to time.

Good luck with your venture!
From, Sell Online And Profit.com

[Last Updated July 7th 2009]

[Last Updated June 30th 2009]

From “Article 3: Correct Product Selection”, you now know the cost of each product you would buy/produce for sale/resale. (If you do not, you have to go back to Article 3 and determine the cost of your product.)

For the purpose of calculation, we will refer to “unit” as one piece of the product in the form it is sold as:

For example:
Unit = 1 piece or 1 box of 10 pieces. (e.g. 1 cell phone or 1 pen or 1 box of 10 ballpoint pens etc.)

Unit by weight (e.g. coffee powder, dry chemicals etc.) = 10 oz, (or grams), 1 lb (or kg) etc.

Unit by liquid (e.g. perfume, wet chemicals, soda etc.)=  1 L, 1 quart, 10 gallons etc.

Unit by service (e.g. plumbers, contractors, programers) = 1 hr, 1 month, 1 job or assignment.

Unit by software = 1 license, 1 title, 1 download

Therefore, “unit cost” is the price of one piece of the product that you buy for resale. Or, the cost of one product that you produce for sale.
From “Article 4: Selling Price”, you should have now worked out your product’s selling price. (If not, please read Article 4 to determine your product’s unit selling price)

From your “unit selling price” and “unit cost”, you can calculate your gross profit and gross margin.

E.g.: One pen’s selling price is $20.00 and your unit cost is $10.00
1. Selling price for a pen is $20.00
2. Less unit cost for the pen ($20-$10) is $10.00

Therefore, your gross profit is $10.00 and your gross margin is 50%. However, you do have other costs and expenses (e.g. rent, salaries, utilities etc.)
If the other costs amount to $12 per unit, you will have a loss of $2.00 per unit.

If the other costs is $3 per unit, you will be making a profit of $7 per unit.

These other costs and expenses will greatly affect your business. Question is, how would you know what they amount to?

The answer is, you need to do Product Costing.

Product costing will give you an indication whether you are able to make money. If you know that you are not going to make money, don’t start, why court disaster?

However, if you find that you can make money through product costing, you can move forward with confidence.
Rule 4: Product Costing

a. For all new products, you must do Product Costing.
b. Do Product Costing on all existing products regularly. Costs will change without you knowing (e.g. increase in expenses, new staff, moving to a more expensive location etc). This increases your overall costs and therefore you must have a corresponding increase in sales to cover the extra expenses.

What should the minimum increase in sales be? How do  you find out? The answer is Product Costing, without which, you may make wrong decisions.
Product Costing is a very important aspect of a successful profitable company.
1. You will be able to work out your ex-factory/ex-store/ex-home based office cost of each product at a certain volume of sales. This cost includes all your cost and expenses excluding sales and marketing and delivery.
2. You will be able to work out the break even point. (I.e. the volume of sales you need to achieve each month as not to incur a loss.
3. You will be able to calculate the projected profit or loss at any volume of sale.
4. It gives you the right information to allow you to make the right decisions. Without which, you will be blindly working month after month. Only realizing you are incurring losses when your money runs out. It will be too late by then.

Product Costing, in it’s simple form, has only 3 items.
1. Unit cost (the price you pay your supplier or the cost of the product you produce)
2. Fixed cost (indirect cost)
3. Variable cost (direct cost)
Explanation:
1. Unit cost: (Please refer to the earlier paragraph where it was explained)
2. Fixed cost:  Costs that remains fixed over time. It remains fairly constant month after month (until you remove/add costs like moving to a more expensive premises or hiring a permanent employee etc).

Examples of Fixed Costs are:
Warehouse rental
Part of the cost of your home (if home based)
Equipment (e.g. Computers, based on purchase price divided by 36 or 48 months or the replacement period)
Your Salary
Salaries of permanent employees
Fixed monthly charges for merchant account and banking gateway
Broadband Internet Connection
etc.

If you are currently operating a physical or online store, look around you and you will identify more items of Fixed Cost. If you are yet to start, you have to guess the items and their costs. It is not that difficult.

Add a miscellaneous items section  as you will definitely miss out on some items and costs.

Add up all the above and you will get your Fixed Cost.

3. Variable costs: Costs that vary month to month depending on the volume of sales. It is a direct cost. Variable costs stays fairly constant to the unit.

Packaging is an example of variable cost. If you pack 1000 units this month and 2000 units the next, your packaging cost next month is 2 times higher then this month. Note that packaging cost per unit remains the same. For example, if packaging cost is $0.50 per unit, it will remain at $0.50 this month to the next for one unit. But total packaging cost for this month is $500.00 while next month’s packaging cost is $1000.00 .
Examples of variable costs:
Part time labor
Banking Gateway transaction charges
Merchant account discount rates
Paypal processing charges
Charge backs
Lost mail etc.
Look around and you will find more variable costs to add to your list.
You will always miss some costs, so add a miscellaneous item to this list and estimate the value.
If you haven’t started your business, you have to estimate the items and their costs.
You can now add all the above to get your total variable costs per unit.

For demo purposes, we will use $1.00 as the variable cost per unit.

Now you can move to the next stage: Calculating the break even point. (The sales volume where you neither make or lose money)
Below is an example of how the Break Even point is calculated:
a. Let us use the pen example:
The selling price of the pen is $20.00
Your unit cost for the pen is $10.00
Your fixed cost is $5000 per month
Your variable cost per unit is $1.00

Therefore, your Break Even point is as follows:
Your selling price of the pen is $20.00
(minus) your unit cost $10
Your gross margin is $10
(minus) your variable cost of $1 per unit
Your margin is $9

Your monthly fixed cost is $5000
Therefore, your break even point sales volume is $5000/$9 = 556 units

You have to sell at least 556 pens a month to break even. At the break even point, you can earn enough to cover all your expenses for the month.

Of course you are aiming much higher than to just break even. Note that you still have 2 more costs.

1. Sales and Marketing (you don’t have to incur costs here if you do not want to, or you may if you want to increase your sales)

2. Shipping/Delivery. (to be paid by the customer)
The above calculations is for one product (a pen). However, you are (or will be) selling more than just one product.

How do you handle the Product Costing for multiple products?

If all the products’ unit costs are close to one another, one method is dividing the total fixed cost by the total number of units of all the products. (i.e. All the products share the same fixed cost evenly).

If the unit costs of each product are substantially different. (e.g. The unit cost of one pen model is $10 and another pen model is $20) You might want the $20 pen to absorb 66% of the fixed cost and the $10 pen to absorb 33%. Do the same for the other products.
For variable cost, the calculation is easier. Let’s take the pen example.

Variable cost for one pen is as follows:
packaging material cost……………………..$0.20
direct labor ……………………………………….$0.20
all others …………………………………………. $0.14
bank discount rate 2.3% at $20(sales)…$0.46
total direct cost for 1 pen ………………………..$1.00
c. Try to understand “Product Costing” as it is going to assist you greatly in good decision making most of the time. With the correct information, you will be more confident, do less guess work and make less mistakes. Mistakes cost money. Mistakes create stress.

Good luck with your Venture!
From, Sell Online and Profit.com

[Last Updated June 30th 2009]

[Last Updated June 23rd 2009]

We think that we get to set the selling price of the products we sell. After all, these items are ours and the company belongs to us. Wrong.

In fact, there is only a small margin we can set the selling price.

The market determines the selling price of our products.

The market is based on cost and affordability of the product and the selling price of your competitors.

RULE 3: PRICING

a. Constantly check your online competitors’ selling price. Adjust your selling price if necessary.

b. If you have just started selling online, your selling price should be a little lower than the most popular competitors.

Alternatively, do it as a promotional sale at a x% discount or as an introductory selling price.

The promotion must have a clear running period (e.g. 3 months). After the promotion ends, you can sell at your regular selling price. If you feel that you want to continue the promotion, you can also do so. (e.g. “By popular demand, we are glad to extend the promotion for another 3 months” – or something to that effect.)

Remember discounts will always attract customers and is easy to do. However, removing a discount is difficult. You will fear that customers will be offended and might reduce or stop purchasing from you.

When discounts are given, it is important to be clear for:

1. Which products
2. The discount length of time
3. The Quantity
4. etc.

If you are selling a mass market product, the market is huge but there is lots of competition and margins are low. You can still make good profits by being efficient and going for volume.

If you are selling a niche market product, you can have a higher selling price, thus a higher margin, but you have a smaller market. This is also lucrative.

So you have to work harder to maintain good, long lasting relationships with your customers. This will lead to very good long term profits.

c. When products are reaching the end of  their saleability, continuously reduce your selling price for these items (even at a loss) to get rid of them before they become dead stock.

Understand and follow the above guidelines to set the right selling price.

d. Correct pricing help bring in sales!

Good Luck. from “Sell Online And Profit!”

[Last Updated June 23rd 2009]

[Last Updated June 16th 2009]

Before you set up any sales company  you need to have products to sell — be it physical goods or services.

Products are the main component of a sales company. Without products there are no sales. So you must select the right things to sell online.
If you have bad products, you will have no sales, or at best, poor sales. This is not a good way to start a sales company. It leads to loses and failure. So you must select the right things to sell online.

RULE 2: Picking Good products to Sell Online

a. You have to make sure that the products you intend to sell are good and are also  the right things to sell online.

b. It is best that you are very familiar with the products you intend to sell. (i.e. products that you are now dealing with, have a passion for or have experience and good knowledge of.)

c. You should be intimate with the products you sell. Know the quality of each product from each supplier. Know the product’s good and bad features etc.

If customers inquire about the quality of your products, you should be able to speak/communicate with authority and ease. Inform them of the advantages of your products.

Customers will often seek your advice and you should be able to advise them according to their requirements with regards to your product.

d. Your products should be current, in demand and priced competitively.

e. Be aware of  fluctuating demand of seasonal products.

f. Be aware of products with short shelf life. Do not over stock these products as they run out of fashion fast.

g. Constantly check your competitors. Learn what products they carry and the methods they use to sell. Follow their good points.

If you are currently operating a brick and mortar business, you should already know your product category well. But, it is still important to constantly check your physical and online competitors and be aware of new products and their good methods of selling. Emulate all their good points.

h. Constantly strive to lower your purchase price. Negotiate with your suppliers, bypass the middle man and move up to the importer (or even to the manufacture/s) if your volume has grown large enough.

i.  Have a few suppliers. This will ensure that you have the best prices and supply. Suppliers can go out of business any time. However, buy more from one supplier to get the best volume discount and credit facilities if possible. Conduct smaller business with the rest of your suppliers. This ensures that if you encounter problems with your main supplier, you can easily switch to your other suppliers for goods without delay. This way, you will have no disruption of delivery to your customers, which is very important.

j. If you are producing your own products, keep quality constant while constantly improving cost efficiency.

k. Keep your stock low but sufficient . Dead stock (stocks that cannot be sold for many reasons) cost money and occupy storage space that you may not have.

l. Constantly look for new things to sell online to add to your product range while dropping those that do not sell. However, newly added products should be of the same category of the other products you offer.

m. Search on Google for your competitors selling the same products. If you see many companies selling similar products, do not despair. It means the market is big and you have to apply Big Market Strategy.

If the number of competitors are small, it may signify a smaller market and you should apply an appropriate sales method.

n. Identify whether your products are for a mass market or a niche market.

If you are selling mass market products, you will have a huge market, but stiff competition and low margin. You still have a good opportunity.

If your product is for a niche market, then margin is higher. You’ll have less competition, but a smaller market. This is also a good opportunity.

Your strategy to cater for these 2 markets are very different though they are the rights things to sell online. Each requires different approaches. Both markets can make you money.

We will address these strategies in our future post on “Sales and Marketing”.
If you cannot find anyone selling your type of products online, it is either good or bad.

Good: You have the whole online market to yourself.

Bad: No one is looking for your type of products online and you have to create a new market.

Another reason could be your products are time sensitive (e.g. food that lasts 2 to 3 days) or products that are difficult to ship through the post. Here again make sure you have the right things to sell online.

Make sure to search for your products with other keywords. Each product may have multiple names. On the web, people come from many geographical locations and may call your product by different names.

If you really want to sell online and have no products to sell, we recommend you do the following to find the right things to sell online:

You can goto Amazon and enter a particular product category and you will see how much literature has been written about that product category. This will tell you how popular that product is, whether it is a Mass Market or Niche product, and also give you more ideas for other things to sell online.

Goto eBay and do the same.

Select around 10 products, study each product until you are familiar with them, and find out where you can source them the cheapest.

After you have done your homework, you can pick the product to sell online.
Make sure of the facts above. Wrong information leads to wrong decisions.

Good luck to you and your venture.

From “Sell Online And Profit!”

[Last Updated June 16th 2009]

[Last Updated June 11th 2009]

To new readers: For better understanding of this blog, it is best to read from the beginning. Please start from Article 1.

90% of startups fail in the first year. Are you in that 90%? Most likely, as the probability is statistically stacked against you.

Does this mean you should give up?  (No. At least not at this stage.) there are many reasons why businesses fail

Read through the following rules and guidelines to why businesses fail before you make a decision.

Though there are some people who are hopelessly not suitable for business, why businesses fail are due to not knowing exactly what to do and what not to do.
The following rules will guide you through your self-evaluation process to find out if you are ready to venture into business. If you are already in business, these guidelines will enhance your skill and enable you to run your company more efficiently.

RULE 1: Personal Commitment. One of the many reasons why businesses fail.

a. Have you done enough research to start an online business? If not, you should start right away. Going into business blindly or without being fully prepared is courting failure.

This blog “Sell Online And Profit” will guide you step by step and in sequence to build a profitable business. First, by identifying whether you are going to fail, thus allowing you to give up before you start. This will save you lots of time, money and heartaches.

If you are suitable for business, the upcoming articles will then guide you through product selection, costing, profit calculation, sales and marketing etc.These steps must be done to give your new venture the best chances to be successful. So take sometime to carefully study this article and upcoming articles to understand each aspect and to know why businesses fail.

b. Are you able to fully commit to seeing the new business through to success?

c. There is a lot of hard work in front of you. Do you feel it is a chore or are you excited and eager to go forward?

d. Do you have the patience? It takes 3, 6 or even 9 months from starting the business  to seeing results (this will be explained in later articles).

e. Do you have the money to start the business and pay expenses until the business brings in sufficient income? (look out for the section “Fixed Cost” in  our future post called “Product Costing”)

f. Are you energetic, innovative and determined, self motivated and focused to **Sell Online And Profit**?

g. Can you persevere?

h. How many hours a day (including Saturdays and Sundays) can you set aside for this business? If you are currently working full time or part time, you have to seriously consider this point. It could mean the difference between Success and Failure.

i. You have to set aside at least 3 to 4 hours a day, everyday, solely for the purpose of working on your new business. (if you can’t do it in the day, do it in the evening or night.)  Initially, you will have lots to take care of (these will be covered in up coming blog posts). Gradually, you will spend less time on these things  as you would have taken care of most of them. But, by then, you will be getting busy as sales start to come in. By which time, you have to start running the business. You will spend time taking care of orders, sales, packaging, stocks, customer service, delivery, marketing etc.

After going through the above points, you should now evaluate your position.

If you are still unsure, give yourself a little more time. Work out your time commitment. Re-evaluate your other options (e.g. looking for a job, or starting a physical store or furthering your education etc). Talk to your family members (maybe you can get financial or work support from them if those are the problems). Address your fears and doubts. Rework your financial commitments to ensure that you have the money to sustain your business through the start-up period.

If after all this, you find that you still have 50/50%  doubt, we  suggest that you scrap the idea altogether.
Reason being, your may not be passionate enough, not have enough time, is unwilling to make time, is unwilling to sacrifice or unsure of yourself etc. These are some of the reasons why businesses fail. These factors will most likely affect you and your business. So it is better to walk away now then suffer failure in the future.

However, if you are sure you are ready at this stage to **Sell Online And Profit** from it, please read  our upcoming posts. There are still pit falls to avoid and rules to follow and more reasons why businesses fail. If you are interested in our up coming articles, please leave your email address with us and we will inform you of new updates via our newsletter.
If you are currently running a physical operation (be it wholesale, retail or a Mom and Pop store), you probably have some kind of connections with the web. There are alot of opportunities for you to improve your sales and profitability by making use of the web. You will come to know many good practices and reasons why businesses fail.

There are at least 2 areas of the web that  your business can take advantage of.
1. Bring in more sales to your physical operation
2. Reach a much bigger market online and achieve even more sales.
The above 2 features will bring in better sales and profit for your business.

We will address “1. Bring in more sales to your physical operation” in a later article. This could be an important read for you.

For “2. Reach a much bigger market online and achieve even more sales.”, please continue reading our next and subsequent articles. You are sure to find very good pointers to improving your business skills and bring in more sales and profit.  If you are already selling online or if you are thinking of starting a {successful online business,} read on. Learn more reasons why businesses fail and avoid them. Our next article will be up soon. If you want us to remind you, please leave us your email address. We will notify you when the next article is published.

Good luck to you and your venture.

Now, go Sell Online And Profit from it!

[Last Updated June 11th 2009]

[Last Updated July 24th 2009]

These are some of the following topics that will be elaborated upon in up coming posts.

1. How to tell if you are within the 90% failure portion
2. How to avoid being in the 90% failure portion
3. Is your product Sellable? and how to identify your products are for mass or niche  market

4. How to know your total cost of each product?
5. How to set Selling Prices
6. How to know whether you would be profitable?
7. How to setup a successful online business by avoiding the common pitfalls
8.details of most online business methods
9. The Pros and cons of various online businesses (e.g. Ebay, Yahoo Stores, Amazon, Your customized online store etc.)
10. if you are running a physical store now, how to increase sales for your physical store
11. How to find and get a personalized professionally done eCommerce website for cheap.
12.marketing methods you can do by yourselves for free to get your websites rank on the first few pages on google search
13. How to increase your sales and profit for an existing online business.

If you find the above topics to your interest, please leave us your email address so that we can inform you when the new blog posts are published because we may not  be able to post constantly or on a regular basis, although we will do our best.

Thank you for visiting our blog. We hope that our blog is beneficial to you. See you soon!

Good luck with your venture!

From, Sell Online and Profit.com

[Last Updated July 24th 2009]

[Last Updated July 24th 2009]

Introduction

The current economic  situation is very bad. Economists are saying that it hasn’t been this bad since the Great Depression in the 1930s. Millions of people have already lost their jobs and millions more will be laid off. Looking for good jobs today is next to impossible. People are at a loss to how to earn an income.

Working  for oneself is one option. But how? To start a business, you’ll need large starting capital – but the banks are not helping with financing.

Therefore a lot of people are considering selling on the web. Starting a successful online business is the cheapest way as it requires the least capital.

However, as in any business, more than 90% of startups fail in the first year. Losing your capital/savings during this bad economic time would just be adding salt to the wound.

So, why do so many startups fail? There are many reasons. On this blog,  we will try our best to address these reasons of failure related to selling online. This will allow you to setup a Successful Online Business.

Why are we  doing this? For the last one and a half years, you have been hearing nothing but bad news. The headlines are filled with stories of Sub Prime Problems,  The Credit Crunch, Bank Failures, Company Bankruptcies, Foreclosures etc. Good people are losing their jobs. Currently, good news is  few and far between. We hope our blog can contribute to you setting up your successful online business.

The most common question asked is “Can I make money selling online?”. The answer is a resounding  “YES!” -  BUT you must avoid the mistakes that others have made that led to their failure. It is not difficult to setup a successful online business if you know how.

It is similar to riding a bicycle. Initially, when you don’t know how, it is going to be difficult.  Once you know how, it becomes easier. We will try our best to make it easier for anyone willing to fully commit oneself to setup their own successful online business.

This blog is for people who are starting or have started an online business. For those who already are selling online but are not doing too well,  will also benefit from reading our blog and following our future blog posts.

If you currently running a physical store (brick-and-mortar), and you want to reach out to more of the right kind of customers, please watch for our upcoming article “Increase Customer Traffic to your Physical Store (Brick-and-Mortar).”

Please read part 3 of this Aritcle.

From, Sell Online and Profit.com

[Last Updated July 24th 2009]