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WEB/DIGITAL Starting an online retail store!

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Yankees338

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Jul 24, 2007
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My friend's dad owns a big pet food/supply distributing businesses, and he also owns a store right next door to the warehouse where he retails many of the products he wholesales. I was at their house last night (his son and I are best friends) and the topic came up about starting an online store for the retail business. My friend and I are both very interested in launching the site. It sounds like this is what I'm going to focus the remainder of my summer on!

I definitely have more knowledge in the area of starting a business than my friend, but we would be able to work very well together. However, I do have several questions on the matter. First of all, what would be a good site to use to register the domain name and host the site? We would also need for the site to have a built in checkout center for payment (I'd prefer not to go through a separate service like PayPal). What types of legal action would we need to take? We plan on running the business as part of the retail store he owns so would all of the legal business just be reverted to that?

The greatest deal of work for this project, I believe, will be in setting up the website. We already have access to all of our products through the warehouse where we will pay wholesale. This way, our owner will make a profit as will we, and we have a fare number to use to determine expenses. This still allows for a favorable profit margin as well.

Once the site is up, we will allow customers to place orders online. Once the orders are placed, we will process them by simply sending a request across the street to the warehouse where we can store all of our inventory. I'm planning on putting together a business plan sometime within the next week. Any questions, comments, or suggestions? Please, feel free to post them!
 

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Yankees338

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I've been giving this idea much thought recently. One idea I've come up with is this - my friend's dad currently owns the wholesaling and retail store. My friend will likely inherit the business once he graduates college and is ready. By that time, I'm hoping to have the business up and running profitably as well as continually growing. My feelings are that my friend will likely want to take over the entire online retail business because he will be running and operating the whole business. I will eventually want to move on to other things as well. Now I believe that once the site has been built up enough after 2 or 3 years, I should sell my stake in ownership to my friend. This would give me a chance to move on to other things such as either real estate or another business venture.

We will need to outline exactly how much ownership each of us will have in the website beforehand.

Another thing we have determined recently is that we will be paying wholesale for the products. While that doesn't seem like anything special, we will still have a competitive advantage. Our office will be located right across the street from the warehouse. Because of this, we will not have the expense of a location to have to store our inventory; it will be conveniently located right across the street.

I've also come up with another idea. I'm not sure if it's something currently being used by other online pet stores but it seems like a feasible option. Most pets go through a bag of food in a set amount of time. They also usually go through their medication or flea repellant at set amounts of time. We will offer customized packages of pet supplies that will ship at a pre-determined time. For instance, if my dog goes through a bag of food every month, 2 boxes of flea repellent, and 1 box of tick protection, we can set up a package that autoships 1 bag of food, 2 boxes of flea repellent, and 1 box of tick protection right to our customer's door. They will never have to worry about keeping stock of their pet supplies and we will have an almost guarenteed monthly income (they can cancel at anytime).

Once again, feel free to comment! Thanks a lot.
 

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I've also come up with another idea. I'm not sure if it's something currently being used by other online pet stores but it seems like a feasible option. Most pets go through a bag of food in a set amount of time. They also usually go through their medication or flea repellant at set amounts of time. We will offer customized packages of pet supplies that will ship at a pre-determined time. For instance, if my dog goes through a bag of food every month, 2 boxes of flea repellent, and 1 box of tick protection, we can set up a package that autoships 1 bag of food, 2 boxes of flea repellent, and 1 box of tick protection right to our customer's door. They will never have to worry about keeping stock of their pet supplies and we will have an almost guarenteed monthly income (they can cancel at anytime).

Once again, feel free to comment! Thanks a lot.

Very good ... might want to check if its being done.

First of all, what would be a good site to use to register the domain name and host the site? We would also need for the site to have a built in checkout center for payment (I'd prefer not to go through a separate service like PayPal).

GoDaddy.com to register the name. LeaseThis.com for leasing names of a premium nature. Most domain names of any value will need to be bought in the secondary market.

As for hosting, it depends on how much scale you need. An enterprise level application would need dedicated servers in which case I recommend Rackspace.com. However, since you're starting - I would go with a shared-hosting environment until your volume dictates a move. Shared-hosting is a dime-a-dozen and cheap.

One caveat to your idea -- does it solve a need? Are you providing a service better than your competitors? Or is your idea simply an idea based on the convenience of your friend's wholesale connections?

Most businesses fail because they are predicated on the wrong premise - "how can I make money?" VS "how can I solve a need? Or do something better?"
 

Yankees338

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One caveat to your idea -- does it solve a need? Are you providing a service better than your competitors? Or is your idea simply an idea based on the convenience of your friend's wholesale connections?

Most businesses fail because they are predicated on the wrong premise - "how can I make money?" VS "how can I solve a need? Or do something better?"

Thanks for the response. It's very ironic that I just read your "story" over at RD, and now, all the things I've learned from it are immediately being tested.

While part of this idea is based on the convenience of my friend's business, it was not the sole reason for this. While it initially sparked the idea, the main idea of this is to create some competition by doing something that is better than the competition. The idea I proposed is the backbone of that plan. However, when we put all of this together, I truly believe we have an idea with loads of potential that I feel confident in. Customer service is definitely another aspect we will strive for the best in.

Keep the advice/criticism coming!

Edit: It looks like we're going to be paying someone to build the site and online store. Right now, that looks like it'll cost $500 up front. They also want $60/month for hosting and are willing to throw in some other services like tech support, 15 hours of labor, email accounts, website editor, search engine submissions (to get more traffic), traffic reports, 20 gb of storage, and unlimited bandwith. The feature that has me most drawn to this is the search engine submission (to the top 19 search engines...). However, I don't know if that justifies spending $60/month as opposed to the $10 or $20 we could pay with a regular shared host (I believe). I'm not all that well trained in the field of web design/hosting. Are there any other advantages to a site like this over a regular shared host? For instance, with security? Thanks in advance.
 
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Yankees338

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Very disappointing day today!:pissed: After all the hard work I've put it on this project over the last few days (probably around 20 hours), it looks as if this project may have just been flushed down the toilet. My friend's dad, who originally proposed the idea after a few drinks, is not so thrilled about the idea and as of now, is preventing us from proceeding. I was on the phone with a web design company about to finalize our order when I was given the red light.

However, there's still hope. My friend and I will be sitting down and discussing the situation with him sometime this week -- hopefully. If he still says no, we'll try and put together an in-depth presentation for him to sway him over; he really should have no reason not to accept this offer. It's adding value to his business as well as increasing his business income. If not, my friend and I will probably wait another year or so to start this up. I've already received another business offer that I feel could be very profitable too. Decisions, decisions, decisions.
 

HenkHolland

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This may be a blessing in disguise.
Starting a business with a friend usually isn't the best idea. Lots of people end up losing their business and their friend.

Since, you have already done some preparational work for the webshop, you may want to use your knowledge and enthusiasm to set up a webshop for another line of products. Forget about the pet supplies, which was not a deliberate choice anyway, and determine what products would be more attractive. There will be lots of relevant wholesalers in your area who are willing to be your supplier. You will be free to shop around for the best purchasing deals instead of having to purchase from your friend's dad.

Good luck.
 

Yankees338

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Thanks. I've considered that as well, but it's seemed like an enjoyable journey from what we'd done so far. We usually get along pretty well, but I understand where you're coming from.
 

WheelsRCool

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I am currently planning to start an ecommerce business, a little one that just fills what I believe could be a nice niche. I need to conduct some more research to see if the niche will be profitable or not, and then I need to make sure I can fulfill the niche better than my competitors. If so, I would be able to expand the ecommerce business.

My goal at the moment is to start and build a successful ecommerce business that I can then you use to save up money to have collateral to obtain a loan to start up my bigger business idea.

Like PHX said though, I need to make sure this ecommerce business solves a real need. I am brainstorming other ecommerce ideas too.
 

Z5 FILMS

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Aug 13, 2007
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Thanks. I've considered that as well, but it's seemed like an enjoyable journey from what we'd done so far. We usually get along pretty well, but I understand where you're coming from.

You don't need your friends dad. I'm sure there's plenty of wholesalers you can buy from. I'd also strongly warn against getting involved in any business with friends or family.
 

Yankees338

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Jul 24, 2007
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You don't need your friends dad. I'm sure there's plenty of wholesalers you can buy from. I'd also strongly warn against getting involved in any business with friends or family.

The benefit we were getting from working with my friend's dad was that we could direct-ship the products and wouldn't have to stock any inventory, thus keeping our expenses very low.
 

Z5 FILMS

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Edit: It looks like we're going to be paying someone to build the site and online store. Right now, that looks like it'll cost $500 up front. They also want $60/month for hosting and are willing to throw in some other services like tech support, 15 hours of labor, email accounts, website editor, search engine submissions (to get more traffic), traffic reports, 20 gb of storage, and unlimited bandwith. The feature that has me most drawn to this is the search engine submission (to the top 19 search engines...). However, I don't know if that justifies spending $60/month as opposed to the $10 or $20 we could pay with a regular shared host (I believe). I'm not all that well trained in the field of web design/hosting. Are there any other advantages to a site like this over a regular shared host? For instance, with security? Thanks in advance.


Even though your plan is not working out, you should keep looking around. Shared hosting will be fine right out of the gate. $60 a month is too much. $10-$20 is more like it.

I get 300 gigs of storage, 3000 gigs of transfer and a bunch of other stuff for $8.00 a month.

Godaddy is cheap source of domain registration. But I find them too "spammy" with advertising constantly all in your face. It pisses me off. I use Register.com. Costs a lot more, but I'm willing to pay to not have ads in my face.
 

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rico

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Search engine submission is easy. I can't think of 19 search engines off the top of my head and I'm on the net all the time. Google, Yahoo, ask.com are the main 3 you need. All 3 have submission pages so no need to pay someone to submit your url to those sites. If the site is big enough you'll get spidered anyway.

Ebay Shops is a good way to start with e-commerce. All the systems are in place, just set up a paypal and ebay account and you're away. Then once established you can market your ecommerce website on your ebay auctions and eventually cut out ebay and their fees. Easy peasy.
 

Andrew

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Aug 8, 2007
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There are too many technical details about building and launching a site to go into here. You should go over to sitepoint.com and start reading their articles.

If you are going to ditch the pet food idea, and are going at this alone (a good choice), then you should be looking for products with a very high markup, 50%+. That might sound silly, but when you are first launching, those margins will be critical for profitable or break-even returns on advertising.

Domain registrar: moniker.com, Clients: paid advertising, search engines (read about search engine optimization, good articles at websitepublisher.net) -- I would focus on paid advertising first. If you can get it to work you can scale up very rapidly. Getting search engine rankings alone is a full time job.
 

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