E-Commerce (With Physical Items) - Mistakes I made.

I started a business in 2008, my whole premise was to use my web expertise to gain business and sell products. In my case it was pet food.

Lessions learned.

Geo-location.

1. I live in South Florida - the worst shipping zone in all of the united states - everything costs more to ship out to other places. So I was always at a disavantage to other vendors that was more centrally located or in major population zones.
2. Products cost more to deliver to "Florida", so my cost basis was higher.

Shipping Contracts.

1. You can get shipping contracts with USPS and FEDEX that lower what you pay based on volume or if you qualify for some association discounts. Hence, I never got the volume because I lived in S. Florida and because my prices were higher. So I ended hurting me more, because competitors got better rates on top of cheaper shipping do to geo-location
2. Social Engineer - I did this to lower my rates, but it really didn't help much - Location was a big factor.

Perishable Items.

1. Never buy more product then you can sell by expiration, pet food expires. Order in small quanities until you build that customer base. Last thing you need is food expiring and money being completely wasted

Pricing.

1. Every distributor of products have different pricing, even if they say they don't. One day on of the distributors left another stores shipment invoice at my store. I was like omfg and gave the distributor an earful and now I was able to get my products 20% cheaper.
2. Send the distributors lunch, a bunch of pizza's or something. Get on good terms with them, paybacks are huge.
3. Contact the manufactor and point out the pricing issues, sometimes they offer your incentives, so you can compete with the guy who sells it, at the price you pay.

Credit Card Fees.

1. Every month call your merchant services company and ask for a rate review. You'll be amazed how many bullshit fees their are. Everytime I called things got cheaper. They will wave stuff like report fees, batch processing fees, lower your per swipe fee, etc. Every time, I called back, they lowered something.
2. Amex is amazing, the free $25 they give customers for shopping locally, is amazin, small business saturday rocks.

Packing Supplies.

1. A lot of this stuff you can get free, fedex provides labels, printers, paper, etc. Take advantage of it.
2. Flat-rate shipping boxes use them.
3. Save your packing material and buy in bulk.
4. Look on craigslist for people clearning out packing peanuts, tape, boxes, etc.

Customer Database..

1. Do whatever it takes to make sure you can communicate with your customer base, make sure your email lands in the inbox. Test from wherever you have to and how many locations you have to make sure this happens. Use my website www.unlocktheinbox.com to get a handle on how to land that message in the mailbox. It's my journal to success.

Hours of Operation:

1. It matters, Be open after most businesses close and always around lunchtime, thats when people shop.
2. Saturdays are always the busiest days, sundays aren't bad too, staying open 7 days help.

Keep in mind, if you sell a unique product no one else sells, then it doesn't matter where you're located. But if you were a reseller like me, it matters.

My online endeavors wasn't very successful because of my phyisical location, but my brick and mortar store was very successful, which I sold for a nice profit.

 

Interesting post, and definately some things I could learn from. I currently partner with a company which outsources many of their services (shipping and warehouse, customer service, etc...) simply because of the low cost at which you can provide these services just by changing states.

 

Do you know if shipping fees would be lower for "Northwest" Florida?

Anywho, thanks for the post, saving a copy to my hard drive.

 

Very helpful tips! If I ever go into ecommerce I'll definitely keep all this in mind. It's amazing the things you learn when you try things out. Thanks for sharing!

 

Thanks for the advice.

Businesses teach us a lot of things that we would not learn if we were not in business.