Quit my Job. Starting My First eCommerce Business.

[twdavis]

Take my word for it, dropshipping for the most part is NOT the way to go unless you already have some kind of brand authority established. You will spend more on paid traffic that what your margins will allow, typically margins on dropshipped items are very very thin to begin with, let alone other expenses.

I'm fresh off a failed dropshipping website, and I learned a ton doing it, but it was not a good choice.




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[sle3pyguii]

Take my word for it, dropshipping for the most part is NOT the way to go unless you already have some kind of brand authority established. You will spend more on paid traffic that what your margins will allow, typically margins on dropshipped items are very very thin to begin with, let alone other expenses.

I'm fresh off a failed dropshipping website, and I learned a ton doing it, but it was not a good choice.




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Definitely. I thought it'd be "easy" money but I realized how razor thin the margins were for most products and how I'd have to rely on paid traffic way too much for everything. Thankfully, I didn't spend too much time or money on it.

Two things (amongst MANY MANY other things) I realized after Jack's call was that I was chasing "quick money". Hence me trying all these different things. I'm trying to settle down and find the one idea that'll grow and scale, rather than one with the quickest profit.

Another thing is THINK OUTSIDE THE BOX. I looked at my peers who tried to start new b2c startups and they all had the same things in common: targeting 18-40 year olds, big cities only, and middle class prices and products. Jack reminded me that there are a BUNCH of people outside of just that demographic, a lot of who are willing to shell out more money.

Finding an idea that I can execute is proving to be a definite challenge, but it's kind of nice knowing that I'm not wasting money anymore.

 

[Kyle Tully]

Take my word for it, dropshipping for the most part is NOT the way to go unless you already have some kind of brand authority established. You will spend more on paid traffic that what your margins will allow, typically margins on dropshipped items are very very thin to begin with, let alone other expenses.

I'm fresh off a failed dropshipping website, and I learned a ton doing it, but it was not a good choice.

Depends.

Every business model out there has it's share of people who failed at it who are more than happy to tell you it's not the right way to go. My experience is every model can work if you learn how to work it.

e.g. We launched a drop shipping website about 3 months ago. Brand new brand/business/website. Products sourced from Alibaba/Aliexpress. You can buy many of the items we sell significantly cheaper from other places. But you can't get OUR selection, marketed OUR way, to OUR niche, anywhere else. Our margins are 35% - 300%. We are profitable on Facebook Ads and building a solid following who buy from us via social media.

Dropshipping is not without it's problems (of which there are many... just like any other model) and we are looking to move as much as possible to import/house brand in the long term to increase our margins and get more control over the entire process. But in terms of getting started quickly, learning what your market wants, and validating an idea, it has been excellent for us.

 

[sle3pyguii]

Been a while since I updated:

1. Dropped the dropshipping idea, like I mentioned before. It kept bothering me because it was something I wanted to work, but I had to keep reminding myself that it wasn't really a good idea.

2. Found a new product on Amazon. I had products before, but it was never something good. The product is doing well, but there were some things that some buyers complained about. The main competitor is also only selling on Amazon. Rather than competing there, I'm planning on creating my brand on other parts of the web and then moving into Amazon after.

One problem was that I thought the product was overlapping with a Fastlane Forum member's, so I PM'ed them. Luckily, I got the green light from them as they had no intention of taking their product into the niche I'm looking at.

I thought of a brand name (no real reason I chose the word other than I liked the word), used Fiverr for a logo (but ended up customizing it myself), found manufacturers, and closed the sample deal last week. The sample shipment is a lot bigger than I wanted though (200 pieces, 2 colors, 100pc/color). But the reason I was okay was because it was cheap, and I knew I could sell enough to break even at the very least.

Need to buy some more stuff to fix the problem the original product had, but the stuff is cheap.

Total time from product to closing the sample: 1 week (could've been shorter).
Total $$$ used: ~$500 (higher than I'm comfortable with, but like I said, I know I can break even by selling only a handful).

3. Went in reverse and I got a J O B. I have a reason though (not financial since I still have plenty of money in the bank). The reason I took this job was because I realized how lazy I was when I didn't have one. When I had the job, I was really productive and good about getting things done quickly and efficiently. After I quit, I lived like I was already living the fastlane life. So in order to give myself a kick in the a$$, I took this job. I got more done since I took the job a week ago than the past few months. The company knows about my side project and allowed me to work part-time.

What's nice is that I'm in an older industry and I see things that can be fixed already. Unfortunately, I want to stay committed to the product I ordered so these newer ideas are on my "list".

 

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[sle3pyguii]

The job has been taking up more of my time than I'd like, but hey...it's giving me money that I can invest into the business.

My samples of 200 came in last week. All the equipment I need came in over the weekend. I'm going to go grab my shipment of packaging boxes from a store warehouse in a few hours. I need to make small tweaks to my site and take the product photos, so I'll hopefully be ready to get everything up by Wednesday.

Some things I learned:

1. Shipping costs are a bitch. My products are light and cheap. I'd be fine with charging the $5 for First Class USPS Mail if my products were something like $50, but they're definitely not that. So what I'm thinking of doing is pricing my items higher than my competitors and utilize "free shipping". I'm hoping the higher price will make my product seem like it's higher quality (which it is. I've improved upon an existing product) and it will eat up the costs up the shipping. If anyone reading this knows of a cheaper way to ship light items, lemme know!

2. Overthinking is horrible. I could've launched a day after I got my products, but I didnt and now I've procrastinated about a week's worth of time. Why? I overthought about packaging, shipping, labels, etc etc. I hadn't even gotten my first sale and I was procrastinating. I realized what I was doing a few days ago, sucked it up, and just made my decisions and stuck with them.

3. For logos, make sure your manufacturer can make the logo you want or be flexible. Mine didn't have a certain font I needed, so they were about to create my logo with a different font, which was horrible looking. So instead of taking up more time, I just make a quick update, and within 10 minutes of them reporting the problem, the products were getting created with a new logo. Yay awesome manufacturers!


Things I'll do by the end of the week:

- Mudderfracking launch.
- Get social up and use @jockinbox's Instagram method and other twitter and FB marketing ideas.
- Get first blog post up.
- Throw together an Adwords campaign (use @Andy Black 's thread) using that Adwords coupon I got in the mail.


I'll try to post here more often so that there's some sort of success or fail record of this. Should be fun.

 

[Andy Black]

Overthinking is horrible.

^^^ Arghhhh.... Guilty!

Keep going.

 

[sle3pyguii]

Found a problem just now with my product.

Bad news is that the problem will cost me about 1.5 weeks to fix it.
Good news is that I found it before I wasted any more time.
Even better news is that all the equipment and stuff I can't use anymore can be returned and refunded or traded in. Yay.

 

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[freelife2014]

Good luck

 

[Davo]

Good stuff so far on this thread, thanks for sharing the journey with us.

 

[sle3pyguii]

Good stuff so far on this thread, thanks for sharing the journey with us.

I'm in the early stages of planning my own business and have no intentions of quitting my work yet (especially since I can relate regarding the unproductive habits when out of a job).

Definitely. I kind of learned the hard way about that, but it all seemed to work out in the end! Good luck with your business!


Update:
Didn't want to waste time, so I made some adjustments to the my creating process. Long story short, I'm back on track. I ran my sample tests right now and they seem to work well.

To do list for today and tomorrow:
- Finish creating demo products
- Put finishing touches on website
- Launch.

 

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[sle3pyguii]

I messed up big,

Long story short, I thought I did a good enough QC. But I didn't. Literally ALL my products had some sort of noticeable scratch or chip on them. I've contacted my manufacturer overseas and I'm hoping this gets resolved ASAP.

One thing that came out of this was that I started looking for a US manufacturer. If I can get this problem resolved with China, I'll continue getting the product manufactured from there. If not, I've got an idea for a unique and stronger product, so I can get a custom one made here and ditch my plans for the original product. Best case scenario, I have both the original overseas version and the stronger US version and I can sell both.

 

[Walter Hay]

sle3pyguii, this is an interesting story, but you might be surprised to know it is one I have seen repeated many times.

In my introductory AMA post Sharing my lifetime experience in export/import. Product sourcing specialist, I said there are lots of myths and misinformation on forums and you and several of those who have responded to your posts have been the victims of at least some misinformation.

So many people believe that the big, well-known, heavily advertised, and popular, B2B sourcing sites are the place to go to find manufacturers. The reality is that the vast majority of suppliers on those site are masquerading as manufacturers but they are in reality traders or wholesalers. True they will still give you a good price, but that price is a lot more than you would have to pay the real manufacturer. True they will modify designs for you, but that makes them unpopular with the manufacturers so they will mostly try to wriggle out of making changes to suit you, even though they said they would.

One of the biggest myths has possibly influenced you in feeling obliged to buy a lot more than you initially intended. Big MOQs are usually quoted and I often read that this is why importing inventory is too costly for new businesses. There are a couple of things you need to know about MOQs:

• The real manufacturers are much more flexible on reducing MOQs than traders or wholesalers are. The reason is simple. Traders often advertise products they have never before handled. Often they used pirated photos of the product. They take orders plus a deposit and then see if they can persuade a manufacturer to supply. The bigger the order quantity, the better the chance they have of making a deal.
• A major reason for big MOQs is to deter newbies. Suppliers overseas are tired of dealing with opportunists and tire kickers. They can easily pick newbies by the things the newbies write in their first emails. This is why so many complain that they never receive a reply from suppliers. They have blown it right from the start.
  
• MOQs can be negotiated down substantially (even to more than 90% less) if you take the right approach.

I suggest you check every now and then for my answers to questions on my AMA thread, because I am hoping to give a lot of help to people in you situation.

 

[sle3pyguii]

Yet another mistake (yay for mistakes and learning experiences):

If you are using a Chinese manufacturer, KNOW WHEN THE CHINESE HOLIDAYS ARE. I thought I would get my replacements shipped out this week, but it is a major holiday in HK, like a week-long holiday. So I have to wait till next week....yay.

The only good news is that everything else is done...I'm just waiting on the replacements...

In the mean time, I'm going to try to grow my instagram and twitter accounts and get more acquainted with adwords.

 

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[Bananas]

Yet another mistake (yay for mistakes and learning experiences):

If you are using a Chinese manufacturer, KNOW WHEN THE CHINESE HOLIDAYS ARE. I thought I would get my replacements shipped out this week, but it is a major holiday in HK, like a week-long holiday. So I have to wait till next week....yay.

The only good news is that everything else is done...I'm just waiting on the replacements...

In the mean time, I'm going to try to grow my instagram and twitter accounts and get more acquainted with adwords.

Huge protests happening in Hong Kong right now - I would anticipate further delays:

http://www.bbc.com/news/world-asia-china-29460525

Look at them, these images are front yesterday.

 

[sle3pyguii]

Huge protests happening in Hong Kong right now - I would anticipate further delays:

http://www.bbc.com/news/world-asia-china-29460525

Look at them, these images are front yesterday.

Yeah, I'm keeping up the protests too. I honestly don't know what to do now.....ahhhhh.

 

[Walter Hay]

Yet another mistake (yay for mistakes and learning experiences):

If you are using a Chinese manufacturer, KNOW WHEN THE CHINESE HOLIDAYS ARE. I thought I would get my replacements shipped out this week, but it is a major holiday in HK, like a week-long holiday. So I have to wait till next week....yay.

The only good news is that everything else is done...I'm just waiting on the replacements...

In the mean time, I'm going to try to grow my instagram and twitter accounts and get more acquainted with adwords.

This is a very important subject. This year there are 27 public holidays in China, including Sundays within a public holiday period.

Once you have an established relationship with suppliers they will give you advance notice so that you can place orders in advance, but in practice that notice is often insufficient. Because of this you should always check the year's calendar. Official announcements for the full year are made in mid December for the following year.

Walter

 

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[sle3pyguii]

This is a very important subject. This year there are 27 public holidays in China, including Sundays within a public holiday period.

Once you have an established relationship with suppliers they will give you advance notice so that you can place orders in advance, but in practice that notice is often insufficient. Because of this you should always check the year's calendar. Official announcements for the full year are made in mid December for the following year.

Walter

By any chance, do you know when it ends for manufacturers? I'm hearing mixed things...I'm hearing 10/7 is the ending, while some are saying it ends today.

 

[Walter Hay]

By any chance, do you know when it ends for manufacturers? I'm hearing mixed things...I'm hearing 10/7 is the ending, while some are saying it ends today.

Those who say 10/7 are right. The Chinese government seem very liberal with public holidays and they sometimes add an extra day or two to compensate for holidays that fall on weekends.

 

[Caleb]

sle3pyguii, your story is absolutely intriguing and I hoe you continue sharing it with us. I am 21, in college, and heavily looking into starting an ecommerce. I am learning from your experiences here and will certainly come back to this forum as I continue to remind myself that even if I run into problems, I'm not alone! Ha!

For those of you that have commented on here, I would like to ask for some help. I have never really looked into it, and there is a lot of information online about how to do it, but I'd rather it come from someone that has already done it or tried doing it. How should I begin my adventure to start an ecommerce?

I already have a product, a niche, and a broad outline of the financial needs this will require. Where should I go from here?

 

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[sle3pyguii]

sle3pyguii, your story is absolutely intriguing and I hoe you continue sharing it with us. I am 21, in college, and heavily looking into starting an ecommerce. I am learning from your experiences here and will certainly come back to this forum as I continue to remind myself that even if I run into problems, I'm not alone! Ha!

For those of you that have commented on here, I would like to ask for some help. I have never really looked into it, and there is a lot of information online about how to do it, but I'd rather it come from someone that has already done it or tried doing it. How should I begin my adventure to start an ecommerce?

I already have a product, a niche, and a broad outline of the financial needs this will require. Where should I go from here?

There's really nothing more you need other than to set up shop. I'm using Shopify, some are on WooCommerce, some sell directly on Amazon and Ebay. You just need to go for it now that you have the product and know the market now. Good luck!

 

[sle3pyguii]

Got my replacements in finally.

Bad news:
A huge number, roughly 20%, had defects that I couldn't overlook. However, because the defects are in random locations on a small fraction of the replacements, it seems it's a delivery problem. I'm going to try to figure it out.

Weird news:
So there's one competitor that I saw with this exact product. The manufacturer I'm using is theirs (which I didn't know until I got this package)...because they just sent me 7 of the replacement parts in my competitor's packaging. Not sure what I should do about this...but....yeah....weird.

Goals for this week:
Launch...finally. I'm not doing a lot of social yet, but I'll be focusing a lot on Adwords to grow it a bit faster.

 

[sle3pyguii]

Finally got it to launch yesterday. Decided I was procrastinating by making stupid busywork (again).

So my site is now live, and I started my Adwords campaign. Pretty sure I'm doing something wrong, but I'll figure it out.

This is gonna be fun.

 

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[TJPB]

Finally got it to launch yesterday. Decided I was procrastinating by making stupid busywork (again).

So my site is now live, and I started my Adwords campaign. Pretty sure I'm doing something wrong, but I'll figure it out.

This is gonna be fun.

What is the URL?

 

[sle3pyguii]

What is the URL?

PM Sent.

 

[Ronnie]

PM Sent.

Please send it to me too if you don't mind. Thank you!

 

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[sle3pyguii]

Decided to nix two features for my product because they complicated it more, while not adding enough benefit to outweigh the complication. I tested out the product by giving it to some friends and watching them use it, and they had a LOT of trouble with something I didn't realize.

The bad news is that because of this, my product becomes EXACTLY the same as my competitor. If you put my product and my competitor's side by side...it's now the same, save for a minor design differences and branding. My price is higher because theirs is on Amazon. It'll definitely be difficult for people to buy mine when there's a near-identical product for cheaper on Amazon...but hey...that's where marketing comes in right? I need to make it seem like my product and brand is worth more than the other guys.

The good news is that my direct competitor is ONLY selling on Amazon and doesn't seem to be doing any other marketing outside of having it on there. I'm going to try to ramp up all my marketing efforts ASAP and see if I can take the non-Amazon customers and build a brand.

What this means:
- I'm going to try to build this brand into something bigger than my initial idea. This means that I'll be reinvest all my profits into marketing my brand.
- I need to get a stable job. Since I'll be reinvesting the profits back into the brand, I won't have any money. My current gig will be up in less than a month, so I'm starting to look now.
- I need to dominate social media and AdWords really quickly. Like I said, if I want to cash in on my Amazon competitor's indifference...I need to get it quick. I started an Adwords campaign yesterday and am getting my feet wet (thanks to @Andy Black and his Adwords stuff). I'm also using @jockinbox 's social media account post to get my social media started.

Day 2 since launch and already a speedbump. Oh well.

 

[Andy Black]

https://www.thefastlaneforum.com/community/threads/whats-your-problem.52780/

Speedbump = Stepping Stone

 

[sle3pyguii]

So I shut down this operation. Yes, it's only been 10 days since launch.

As I mentioned before, my product was no different than my competitor after I removed the additional things I wanted to add. I didn't see a way to add value without adding additional components that would jack up the price to something that'd be completely unreasonable.

I now have a box of supplies in the corner of my room. If I come up with some sort of value addition, I'll try it again. Till then, I didn't feel right to keep this up.

On a lighter note, thanks to the project and @Andy Black, I did learn a good deal about Adwords. Definitely fun to use and will be using it again in the future.

I'm now going to try my hand with another cheaper item, except this will be 100% on Amazon FBA. Will order it tonight. Hopefully get it up to Amazon FBA soon. It's in a restricted category though, so that'll be a new adventure.

Sorry I couldn't post about any real successful updates yet.

 

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[Entrepreneur99]

I'm yet to take action on even my first venture so take my input with a grain of salt, however it seems there's a whole lot of people on this forum joining the e-commerce bandwagon because of its low barrier to entry and also sacrifice the commandment of need. I've now read 2 different posts in the past half hour about people quitting on their e-commerce venture because their product offered no benefit over their competitors, they had no trusted reputation through Amazon, Ebay etc, and simply couldn't compete with the tactics of high volume low margin of the big brands and were making close to if not 0 sales. I truly am learning from others mistakes.

 

[sle3pyguii]

I'm yet to take action on even my first venture so take my input with a grain of salt, however it seems there's a whole lot of people on this forum joining the e-commerce bandwagon because of its low barrier to entry and also sacrifice the commandment of need. I've now read 2 different posts in the past half hour about people quitting on their e-commerce venture because their product offered no benefit over their competitors, they had no trusted reputation through Amazon, Ebay etc, and simply couldn't compete with the tactics of high volume low margin of the big brands and were making close to if not 0 sales. I truly am learning from others mistakes.

Good to know someone's learning stuff from my random updates!

Here's a quick list of all the stuff I've learned so far:

1. Add real value. Not stuff you THINK is value.
2. Watch someone unwrap, assemble, and use your product. It'll tell you a LOT about how your customers interact with your products.
3. For your first validation run, ordering a small sample at a high unit price > ordering large order at a small unit price. Yeah, you won't make much profit (might even take a loss) from that first sample run, but it's a damn fine way to minimize loss if the market doesnt like your product. For example, I wasted $700 on this last project instead of losing $80. Really.
4. If you haven't found competitors, you're doing it wrong.
5. Add real value.