Those articles are barely relevant to the small scale newbie starting up in eCommerce. They are talking about the giants in the industry such as Amazon and WalMart.Hey everyone,
Hope you're all well and killing it today!
I'm in the process of starting up an ecom store and came across a few articles today that paint a pretty depressing picture about the profit margins in ecommerce. See below.
The Inconvenient Truth About E-Commerce: It's Largely Unprofitable
Why It's So Hard to Make a Profit in E-Commerce
Just wanted to hear from anyone who currently runs an ecom store or has a lot of ecom experience who could offer their opinion on it.
I see ecom as a business model that satisfys 4/5 of the CENTS requirements (Commandment of Entry i see as being a bit too easy) but other than that seems pretty solid, but the possibility of super low margins has me a bit worried, hopefully someone can prove me wrong.
Thanks
- There are two main factors to take into account when choosing what to sell online. Competition. Too many people use tools such as JungleScout to find hot sellers and they finish up launching into highly competitive areas where margins get lower as more people find the same product in their JungleScout research.
- Sourcing. Profits begin with buying, and unless you buy at the right price your margins will be low.
There are ways to make your URL a part of the product post-production. For those doing private labeling my labeling book could help. It shows how to use various forms of permanent branding at low cost once you receive the goods, but I am sure that if you give it enough thought and research you will be able to work it out for yourself.
Walter
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