Ecommerce offers all kinds of benefits for consumers and businesses alike, and new research shows that completing transactions online is now the way many customers prefer to shop. According to a survey of more than 2,500 individuals conducted by Periscope and McKinsey researchers, 70 percent of respondents reported that they've taken part in some type of online shopping recently.
As online shops continue to see rising demands, more organizations are looking to break into this marketplace. Here are a few key steps to follow when opening a new ecommerce business:
1) Decide what you're going to sell
First and foremost, you must choose what product or service you'll be providing for customers. As Shopify pointed out, this can be one of the most difficult parts of setting up a new online store. However, with a little consideration and potentially some market and competitor research, stakeholders can find an appropriate niche.
2) Pick a name and register it (Don't forget your domain!)
Once you've decided upon your product or service area, it's time to choose a name and build out your brand image. Your company name can help inform the design of your logo and other marketing collateral, and support the design of your website.
Speaking of which, remember to register your business name, and secure a domain name for your website that aligns with your brand.
"All organizations – even those that solely operate online – require an EIN."
3) EIN, business licenses and permits
In addition to registering your business name, there are a few other important corporate items to attend to. These include obtaining your Employer Identification Number, or EIN, through the Internal Revenue Service. All organizations – even those that solely operate online and don't have any employees besides the business owner – require an EIN. This resource from the IRS explains more.
Stakeholders should also be sure to apply for and obtain the necessary business licenses and permits to enable selling. In order to avoid fines and other penalties, check with local and state authorities about required home business or tax licenses.
4) Build your inventory
Next, it's important to establish and maintain your inventory of merchandise, or the items necessary to support your service. Establishing a strong working partnership with a trusted vendor can help things go smoothly at launch and throughout the business's lifecycle.
5) Organize order management
Once inventory is in place, it's imperative to have a system for organizing merchandise, as well as streamlining order management and fulfillment. In this arena, there's simply no substitute for an innovative order management system like SFG's FlexOMS.
This advanced technology can help maintain product availability and allocation to avoid dreaded "out of stock" notices. In addition, it quickly and transparently calculates shipping and sales tax for each order, supports customer credit card authorization, and can even disperse emails to recipients to let them know when their order is in transit.
Starting a new ecommerce company requires some planning and forethought, as well as an intelligent OMS. Connect with SFG today to learn more.