What You Should Know Before Opening an Ecommerce Business

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Electronic commerce or e-commerce is a term for any type of business transaction that involves the transfer of money across the Internet. It covers a range of businesses, from consumer based retail sites, to auction or music sites, to business exchanges trading goods and services between corporations or people. Examples are Etsy, Amazon fulfillment, a hotel's booking site, or a simple page set up to sell your own needlepoint patterns.


Since there are thousands of options available for online sales, you'll need to make yourself stand out from the crowd. Here's what you should do when starting an e-commerce business.

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Study the Marketplace

Analyze other e-commerce sites and understand how they work. It's important to be aware of the market's demand and how your shop will be different from others. You also need to understand what your clients want. It might be worthwhile to invest in market surveys and talk with people that can give you advice about your business model.


Once you get going, don't be afraid to reach out to your customers to see if their needs are being met. You can offer surveys, and offer a discount on future purchases or free shipping for people who fill out the survey.

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Offer Specific Products

If you invest your efforts in a specific market niche, you will increase your chances to succeed. For example, instead of opening an online store that offers food in general, focus in one type – such as gluten free or nostalgic foods. Look into research products like JungleScout that help you analyze the sales of specific products on Amazon. MerchantWords lets you test different keywords to see how consumers search for specific products on Amazon.


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Find Reliable Suppliers

Before you begin selling, your supply chain must be in place. If you purchase items wholesale, you'll need to make sure you can get them on time to get them out on time. If you're making the product, you'll need to set time aside to create. Decide how you will be shipping and delivering products to customers. Your supply chain is an extension of you; if you have a problem during the delivery, for example, the customers will complain directly to you and it will affect the reputation of your company.


When looking for suppliers don't look for the cheapest service, but for one you can rely on. Although it will be a time consuming task, it will prevent a lot of headache in the future. Check out Alibaba, which lets you post requests for proposals for products from primarily Asian suppliers. Some suppliers can provide you with different levels of products (in terms of features), help you with product packaging and even help get your items properly prepared for and delivered to Amazon's warehouses.


If you can talk directly to producers you will have a better chance to get the products at better prices, which will make you more competitive in the market. Offering quality at a good price will help your e-commerce business to stand out from other online shops.

Choose a Platform

Don't make large investments in technologies in the beginning. You can find good platforms that will satisfy your initial demands for a fair price. Be sure to coordinate mobile readability and payment processing across the board. You can test market your product on eBay or Etsy, then look into Amazon's Fulfillment by Amazon option. You can also purchase e-commerce storefronts and link them to your website. Website hosting companies like GoDaddy let you buy a URL, host a website and create an online store, keeping all functions together in one account.


In addition to finding the right shopping cart, you'll need to determine how you will take payments. This will require you to open accounts with payments processors such as PayPal, Stripe and Google Pay.

Invest in Marketing

Investing in social media, newsletters, and online ads can be an efficient way to make your e-commerce site successful. Make a marketing plan for your company and put on paper how much you can spend on it. Depending on your product, you can look for digital influencers to make a partnership and advertise your shop in their social media.