Is eCommerce Business For You?

Think about this. You are planning to engage in “eCommerce”, to take your business online. So, you need to learn a new set of business rules, a new way of doing things, because online business is “different”, right?

Well, actually, no, not really. You still have a product or service to sell. You still have a store with a shop “window” (your website) and you still need the customers to visit your store, in order to buy whatever it is that you are selling.

The only major difference is that (continuing the analogy) your local store window can only be seen by a small group of people, whereas your online business can be seen by the whole world. By engaging in eCommerce, you can take your business “global”.

For many businesses, this is truly an advantage, representing a wonderful opportunity.

But that is not the case for everyone, particularly for companies who sell a physical , tangible product. When planning to go online, therefore, you should spend some time thinking about your product and exactly who your target market is, because this will be a crucial factor in determining whether your venture is a success or a failure.

What it is that you plan to market on your eCommerce enabled website, and who will want to buy it? Some products will, by their very nature, not be totally suited to a world wide market. Pork based food products for example, will not be popular in Muslim countries, nor will wine, whisky or beer. Sales of open toed sandals may be disappointing in Iceland, Greenland and the frozen polar North.

Secondly, give very careful thought about how you will get your product to the customer. For example, if you were to make laser toner cartridges in Asia (as one of my client companies does) there is absolutely no sense in trying to sell one or two cartridges at a time to a customer in the USA, because of the cost of delivery.

So, if your product is bulky or heavy, selling outside your locale may not be practical.

Furthermore, you need to consider that, whilst most countries use the same Standard International Trade Classification (S.I.T.C) codes for deciding on how much import duty to levy on a particular product, the actual duty to be paid varies from country to country, and such variations can (and will) lead to disputes. Again, using my client as an example, they sold a consignment of toner cartridges to a customer in Finland, which got held up in Customs for several weeks on arrival in Helsinki, because of a dispute over the Import Duties to be paid.

Whilst this was not the fault of my client or his customer, nevertheless, the result was an unhappy customer, who obviously did not become a regular customer.

Likewise, if you plan on selling a service online, can that service be provided outside your local area in such a way that you still make money? Do you need to have one of your own staff actually work with the customer (in which case, you need to stay local) or can the work be easily subcontracted on a global basis? Would it be easy to find such a local subcontractor capable of supplying your advertised service in such a way that both you and the customer are happy? How much would such a subcontractor cost?

Unless you can get positive answers to all of these questions, then, again, it may pay you to keep your services local, rather than overreaching, in order to become a global player.