Setting up your own webshop: dos and don’ts
The price
Prices for setting up a webshop vary greatly. When you link your site to a payment and stock management system, you will need to invest a few thousand pounds. The overall start-up price - design, promotion, buying your products, stock management, etc. - on average ranges from £5,000 to £25,000. But this doesn’t include the overheads, e.g. for webhosting.
Up to you
But perhaps all you need is a kind of online spreadsheet? Customers can then place their orders via e-mail and they can pay in advance or when collecting the products. In this case, setting up your webshop will be inexpensive. Note. Be aware that most online shoppers attach great importance to efficient payment methods, for instance by credit card or PayPal. Operating such a payment system isn’t cheap, but it’s an excellent way of attracting customers who are prepared to pay on the spot.
How long can you wait?
Good marketing can make you more “findable” online, but you shouldn’t expect results immediately. Draw up a sound financial plan and calculate the period you can span without any income. You should also be aware that running a webshop is a labour-intensive affair, so you may not be able to combine it with a full-time job. Note. Are you considering a loan for financing your webshop? Remember that banks will be more inclined to lend money if you haven’t given up your current job yet! You can also try and find a co-investor, but then you’ll have to make good prior arrangements.
Be transparent and inspire confidence
Lots of webshops are not transparent when it comes to products, delivery terms and prices, hidden costs which crop up only when customers checkout. As a result, they are flooded with questions, and replying to all these e-mails takes time and therefore money. By providing clear information in an FAQ or a good Help section, you can save yourself lots of trouble and inspire confidence at the same time. Make it clear that you’re not another obscure online shop but a reliable business with a postal address and a telephone number.
Delivery
A recent Ernst & Young survey showed that two out of three online consumers have complaints about excessive delivery charges. This suggests that free delivery is an excellent way of attracting customers. You can try to compensate the extra cost by not selling at rock bottom prices. Indeed, another study has shown that people shop online mainly for reasons of comfort and speed. Price is only a secondary factor.
Suppliers
A small webshop is generally not in a position to demand good terms from its suppliers. So don’t forget to renegotiate with your suppliers as your business expands. Note. Don’t negotiate about prices only, but also about stock and delivery times. Indeed, if your suppliers let you down, you will not be able to live up to the promises you’ve made to your customers.
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