Tips to Start an eCommerce Business without Spending Much Money

Launching a business is a daunting task but it isn’t quite as expensive as some might think. There are ways to start on the entrepreneurial journey without spending a lot of money – and eCommerce is one of the most common routes to consider. Starting an eCommerce business has never been more affordable and in this guide, you’ll get to learn the tricks to getting started.

Deal with the business stuff

You will need to take care of administrative things in order to launch an eCommerce business. This is the boring bit but important in terms of ensuring things run smoothly. Some of the registration stuff will cost money while others are free, aside from your time. The costs can also depend on the country you are launching your business in – business registration costs in certain countries.

The checklist for the business stuff is as follows:

• Come up and register your business name.
• Purchase a domain name and a website.
• Pick your business structure.
• Apply for a business license and a permit – you can find the required information on the government’s website.
• Stay compliant with tax rules and regulations.

Ideas are free

The most important part of a successful eCommerce business is knowing what to sell. Coming up with a product idea is not that expensive – in fact, ideas are free. When you are thinking about what to sell, you need to keep in mind two things:

• Don’t pick your product on a whim but carefully consider different options and don’t be afraid of looking outside of your comfort zone. This means considering products that you might not yet be familiar with.
• Don’t think there is a perfect product idea and you just need to spend an eternity to find it. You can overthink yourself out of a good business idea.

What you need to do is come up with different ideas and find a way to validate the product’s potential. The best way to do both at the same time is to browse existing shops and see what they are doing. You can find plenty of stores on platforms like Shopify and OZCodes – explore the product selection, identify the products that tend to sell the most and find those hidden gems that people are looking for but not finding.

When it comes to picking a product, the most common advice is to find a niche and to stick with it. While a niche product is definitely easier to market against a product that’s widely sold already, you don’t want to be too narrow with your niche. This is because it can limit your option for scaling – and turning in more money.

A good idea is to pick a niche (such as children shoes) and then eventually broaden your eCommerce to a wider reach (all shoes). You can also test the appeal of your niche by considering what kind of content you are able to create – if you can’t come up with over 80 blog posts on the product, you are in trouble.

Start with no stock

It might sound like a crazy suggestion but you shouldn’t go out and purchase a stock. You have your product in mind but you shouldn’t go out and stock it. This is because acquiring a stock costs a lot of money, which is something you don’t have and you certainly don’t want to spend the little you have in stock. Furthermore, you might end up with a room full of products with no one looking to buy them.

You need to dropship products instead. What does this mean? You can dropship with certain vendors like Oberlo and have your products only ordered once you get an order. Therefore, you sell the product and only once you’ve sold it, do you purchase it from the vendor.

This allows you to test your products and see which ones are actually in demand. If you find something selling like hotcakes, you can, always, start stocking it once you are building a steady stream of income.

Learn to do things on your own

You should also avoid hiring extra help with your eCommerce business. Knowledge is not only power but also money and the Internet will provide you with all the possible knowledge – mostly free of charge. You can learn anything from building a website to marketing your products online – you don’t need to hire a copywriter or an IT person to get started.

Spend a bit of time browsing resources about running a business. It’s important to gain as much knowledge in different aspects – customer service, marketing, sales, accounting and so on – to ensure you can launch without the need for extra help

Marketing without a fortune

Aside from picking a winning product customers would want to buy, you should also focus your energy on marketing your products. If people don’t know about your new online store, they won’t spend any money on it. You need to be a realist here – every single eCommerce business that makes money also spends money for generating traffic.

This doesn’t mean you need a huge budget but you do need to be willing to spend something on online ads in order to generate traffic. So, what are the different marketing routes to keep in mind? You should:

• Be active on social media. Pick the platform that works the best with your product and start building an audience online.
• Create content regularly. Make sure to fill your website and social media with content at least once a week. This should be SEO driven and focused on generating a viral buzz around it.
• Use paid advertising on social media and online. When you start having a good amount of content and your social media is active, you need to start promoting your site via online ads. Use Facebook ads, Twitter’s promoted ads and Google AdWords

Keep the operational costs Low

You also need to be smart with your operational spending. The most common and unavoidable operational costs for your eCommerce site are:

• The monthly fee for running a dropshipping business. Different platforms will charge you for this opportunity.
• The upkeep of the website.
• The marketing.

However, all three areas can be controlled and manage. You just need to compare different options and to do this regularly – don’t just compare different hosting options before you start your business. Check what different hosts are offering every six months to see if you might be able to save money down the line. You should do the same with marketing – split test your ads and try different platforms. Invest in the ads and marketing platforms that work and stop wasting money on those that are only breaking even.

Focus on sale

Right from the start, your focus should be on the sale. Too many eCommerce sites make the mistake of focusing too much on the website design or finding the perfect product that they forget the basic point of a successful business: selling things.

You won’t be in business for long – no matter how lean you start – if you don’t make more than you spend. Even if you spend $0, you still need to make $1 to be successful. Therefore, ensure you get your margins right and focus on the sale.

Now, getting your margins correct requires just a bit of careful calculation. You need to know how much you spend on a single product (buying it, shipping it, marketing it and so on) and then calculate a price that customers are not only willing to buy but which will do more than break even. You need to make a profit from each product and the sweet spot shouldn’t ever be less than 10%.

When you are thinking of adding something new to the website or launching a new marketing campaign, think what it will mean in terms of the sale. Will it help make selling easier? Can it help in making the customer experience of buying better? Does it increase sales? If the answer is yes, the idea might be worth exploring and investing in. If not, then don’t bother sticking with it.

Starting an eCommerce business doesn’t require you to break the bank

If you examine the above points and tips, then you can notice that putting together an eCommerce platform isn’t expensive. You can easily get started with just $50-$500 and that isn’t a lot of money to start a business with the potential of generating income instantly.

However, you do need to keep the tips in mind and be smart. It is possible to throw money at an eCommerce business – you can buy a huge stock of products, spend money on a flashy logo or have someone else design your website and content. But you shouldn’t do that – and you won’t if you follow the tips above.

Now, if you have an entrepreneurial mind and you are willing to put in a bit of work, you can get started without spending much money. So, are you ready to take on the challenge and gain financial freedom today?