Why NOT to Start an eCommerce Business – Part 2
Welcome to Part 2 of Why NOT to Start an eCommerce Business. That’s right, 10 reasons why you should walk away from investing in a business selling products online! The first part of this series touched on; Experience, Competition, Capital, Supply, and Time. In this second part, I will focus on; Leadership, Vision, Patience, Growth, and Future.
As mentioned in the first article, these apply to start-up type businesses, with entrepreneurs considering investing in an ecommerce business.
Thanks for all the great feedback on the first article!
6. Leadership
In this field, it’s inevitable you’re not going to have all the answers. As a leader, your team is looking to you for guidance. If you don’t know how to lead your team to the right answers, then you are asking the wrong questions.
Many successful leaders are passionate about their business, products, and customers. This passion trickles down to their employees, and helps set the stage for success. Great leaders combine this passion with a roadmap for success and don’t let failure deter them.
I’ve seen many tentative entrepreneurs, who are unsure of themselves, their business, and their products. This second guessing and whish-washy mindset will guarantee catastrophic failure! Not being able to understand the technology, the marketing, or the competition will cause some serious setbacks.
As an entrepreneur, you need to lead your business through all these hurdles and provide clear direction to your team and your partners. Use your team and partners to help fill in the gaps with what you don’t know, but don’t depend on them exclusively to drive your business for you.
7. Vision
Even with a strong passion for your business, products, and customers, without a vision for where you are going to be in 1, 5, and 10 years, there is a strong chance you won’t make it that long!
A vision is an articulate plan for the direction of your business. With the ever-changing internet landscape, this is a harder task than most. It’s challenging to develop a vision when you don’t know what new technology will be cutting-edge next year, or where your ranking within Google will be after their next algorithm update. However, you can develop a vision for how you operate your business, your products, and how you service your customers. These are things you have control over!
Many failures lack this vision, and grossly underestimate their chance for survival in the future. The internet is rapidly evolving, and the turn-key, template site model is not sustainable unless you have some amazing, differentiating products, prices, or service! If your business model doesn’t have a clear vision, don’t spend a cent on design and development! Map out your future and ensure you have a clear roadmap for success.
8. Patience
When you are developing your vision, and planning out your roadmap, make sure to be very conservative in growth. I have seen too many businesses get over anxious and meet with severe disappointment when their new ecommerce business launches, and they aren’t making millions within the first few months!
If you don’t have the capital to be patient, and wait out the market dips, ranking woes, technical glitches, etc… then you have already set yourself up for failure. The art of implementing your roadmap, and being patient during the process, is key to taking your business from start-up to sustainable.
Understand that success will take time, and you will need patience to weather the storm before you begin to see daylight. If you don’t have patience, you better have a big bank roll, because expenses are going to be high!
9. Growth
In developing your vision and in leading your business toward future success, how have you identified growth of your company? Growth in profit, customers, employees, products, partners, expenses, etc…
Planning for the growth of your company is critical. As sales increase, usually your employee base and expenses will increase in kind. Now, this is usually a good problem to have, but if you don’t have the staff or capacity to fulfill your orders then you will be forced to turn them away (nobody wants to do that!).
On several occasions I’ve seen businesses having to disable purchasing on their website due to; insufficient staff to process orders, product shortages, and manufacturing bottlenecks.
10. Future
This is where the rubber meets the road; combining vision, with growth, and leadership, and you have your business future. What will the future of your business be? Before you begin shopping around for an ecommerce partner, be confident in your businesses future; it’s going to take much more than a great website design and some Pay-Per-Click marketing to get you from the red to the black!
In the end, everyone has their dreams, and sometimes those dreams are realized. However, without these core skills, your dream may turn into a nightmare and leave you with nothing but regrets in the end. Don’t let this happen to you. Invest a few months in the planning and preparation of your business plan and try to poke holes in it from as many angles as you can. Get feedback from those experienced in the ecommerce industry to see if your plan is sound.
Investing a small portion of your time and money into preparation prior to execution will pay you back in spades-whether you decide to move forward or not!
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