Business Today: Offline vs. Online
If you ever considered starting a business, you have come across this dilemma. What means running a traditional shop compared to an e-business?
Investment over certainty
To open a conventional shop you have to invest a considerable amount of money without even having the certainty of success. And no, your enthusiasm in the beginning is not a warranty. Therefore you have to:
- Rent a location for a minimum number of months, maybe a year
- Buy furniture for the shop and brand it
- Build a stock of products considering the available space of your storage
- Pay monthly fees: rent, electricity, water and phone bills
- Employees’ salaries
And these are just the most obvious expenses. Monthly costs are here to stay, no matter if you have sales or not. If the sales don’t meet the costs, you’ll just have to put in your money to keep things running. Bottom line, you have to spend a lot of money BEFORE you really find out if your business has a chance to be successful in future or not. With this type of startup you can’t have the certainty of reaching your objectives. The only sure thing is that money and time have to be invested just to make the business exist.
On the other hand, an online startup has more benefits. Actually, it’s beyond comparison.
To open an online business you need:
- A domain and a host
- The actual shop: if you buy an online shop already built, the investment is not as expensive as setting up a physical shop
- The products: here’s another awesome benefit: although you can have 5000 products on site, this doesn’t mean they have to be in your back storage. All products are available on order. You can set your products’ delivery to about 3 days, having enough time to purchase them from the supplier and send them directly to your clients. In time, you can also build a physical stock for most ordered products, which means your online business is valid and successful.
Clients’ demographic
A traditional shop can sell only to the people that come in it. What are the chances that you’ll be visited by someone from another city or country? To display your products in another city or neighborhood, you’ll have to open another shop in a new location and start over again spending to set up the new point, without any certainty of pay off. An online business doesn’t have geographical boundaries, no matter your field. The world is your marketplace.
“The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.” – Peter Drucker
Cutting down employees’ number
A conventional shop needs trained employees. You need sales persons that know your products and have experience. A cashier and a stock manager are also mandatory to keep everything running smoothly. Don’t forget about the accountant to help you calculate taxes. If you are thinking you can manage all roles alone, you will be disappointed. It’s beyond one person’s capabilities.
With an online business, things are different.
First of all, there are no sales persons, because the product’s page can have all details needed for the sale. Make sure you include in the content all useful information to make the customer’s overview of the product as clear and attractive as possible.
The cashier is again needless because the client alone adds to cart the products and ships them to his or her address. The user can pay by card or when the delivery is made.
Moreover, the website can have automatic functions like: keeping stocks up to date, generate receipts, notify the owner for every new order and many others. It can even let you know when a highly sought product is out of stock. These functions can be integrated t o the site by customizing it according to your activity’s type.
Work program
In few words, when the mall is closing, your shop closes too. Until next day, you have no sales, but your shop keeps spending. The same scenario takes place on holidays or short working days.
An online shop is open literally all the time. It is open on weekends, holidays, night and day. It’s your best salesperson. In fact, a tuned website acts as a professional sales team.
Most of your clients don’t have the possibility to shop or browse online solutions during their working time. So they do it after. Make sure you are available for your clients’ possible questions offering a working contact service, email or phone if you don’t mind helping them after 6 PM.
Product gamut
In a traditional shop you can sell only a strict number of products. A limited stock. This is due to space limitation mixed with logistics. Keep this in mind and now compare it with the potential of an online activity where products exist only virtual, being available only if ordered. You are the one that decides the number of products available, not the storage’s area.
Convenience
To a conventional shop, the client has to come physically. This means he should have time first. Then she/he should overcome traffic, rain, blizzard, park the car, leave the children at the playground and finally reach you. All these are obstacles that come in your customer’s mind and can prevent him from making the effort of visiting you. When you have an online business, the client makes no effort. He visits your e-shop from the convenience of his home. Basically, the obstacles of the outside world are eliminated.
The quantity and quality of information
When was the last time you could read in a traditional shop the user’s manual or presentation of a product you intended to buy? A website can easily attach to every product a list of useful information, examples of usage or presentation videos. Moreover, it can add an unlimited number of versions, colors and sizes available for the product, which are extremely relevant details for a customer in deciding what meets his/her desires.
This extensive choice palette improves your business’ image in the client’s view because it makes him/her understand that you don’t want only to sell, but to help in choosing better and understanding how the product works. This approach lowers the number of refunds and creates trust in your brand.
Bottom line, having an online business presents more advantages than setting up a traditional one, when considering startup costs and other benefits, but that doesn’t mean any online activity is destined to succeed. Online is the best method to start a new activity thanks to low risks. In time, you will need physical locations that will help your business grow and are mandatory for an efficient evolution. Make sure you focus on an efficient startup and developing strategies so you can reach your business targets.
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