Running an Online Shop: Pros and Cons

Today I’m introducing my first ever male guest blogger Trevor Ginn of HelloBabyDirect.co.uk!  Dadpreneur Trevor is going to give us the basics on running an online shop. It would be great to have a few more blokes around here, so if you’re a dad who started a business to spend more time with your baby or toddler and would like to be featured on Business Plus Baby then drop me a line! Anyway, over to Trevor…

The huge amount of money which parents spend on products for their newborns inspires many parents to think about setting up some sort of baby focused retail businesses.  The baby sector is an attractive option for would be entrepreneurs as it has been hardly been touched by the recent downturn.  Recession or no recession, people still have babies.

An increasingly popular option is to ignore the traditional brick and mortar shop in favour of selling online.  This strategy is in many ways sensible as, while the rest of the retail sector is in the doldrums, online sales are still experiencing double digit year on year growth.  Buying online has great advantages for parents in terms of convenience and increased product availability.    In addition, the barriers to entry online are much lower than traditional retail.  So how easy is it to set up an online baby shop?  This post looks at the pros and cons of this business opportunity.

Pros

Easy to start

Sites such as eBay and Amazon make it easy to start selling online.  These marketplaces have a huge, international user bases which allow sellers to get off to a flying start.  Very limited technical knowledge is required, although a basic understanding of HTML can help to make listings more visually attractive.  There are also no set up costs to sell on eBay or Amazon.

For people with more technical know-how, setting up a transactional website is also not as difficult as it used to be and there are lots of solutions available off the shelf at a very low cost or even for free.  OS commerce and Magento are popular open source solutions for creating an online shop.

Cheap

An online retailing business can be started on a very limited budget.  All that is required is some stock and an online presence on eBay or Amazon or your own website.  This is all easily achievable for around £2000-5000.

(Note from Helen:  If you want to know how to do it for less than £200, check out How to start an online shop on a budget)

Sales 24-7, worldwide

Unlike a high street shop, sales on the Internet can be made 24-7.  The Internet also opens up a business to an international audience.  Around 20% of eBay sales are international and the current strength of the Euro makes UK prices attractive to people in the Eurozone, even when additional postage is considered.

Not limited by geography

An online retailing business can be run from any location and an expensive high street location is not required.  Many sellers work from home, although this may become difficult as sales grow.

Cons

Admin intensive

Running an online shop is hard work.  Creating product listings are time consuming and maintaining the product catalogue is a never ending job.  The proposed VAT increase, for example, will mean the retailers must reprice all their products.  In addition all sales should be packed and dispatched on a daily basis.

Customer service

There is no getting away from it, customers can be a pain.  Being a retailer involves dealing with the general public and so it is important to be patient.

Solitary

Running an online retailing business involves very little face to face customer contact and so can be a little lonely.

High competition, low margins

Let’s face it, the web is where people go to get bargains and consequently competition is fierce.  Margins in online retail tend of be lower than on the high street and so retailers need to compensate by selling more.

About the author

Trevor Ginn set up and runs the online nursery shop HelloBabyDirect.co.uk and you can read his blog at www.trevorginn.com



Comments

  1. it’s always so interesting to hear what people are up to, and decide to do when having kids!

    Thanks for sharing.

    Amelia.x

  2. An online store is a great starting point for a business when you have young children. You can be flexible in your working hours and tailor the business around your family.

    • I agree Lynn, it’s so much more flexible than running a bricks and mortar shop when you have small children. But I know it’s harder work than a lot of people think it is, so it’s great to hear from mums who are happy and successful running their online shops.

  3. Interesting to read what Trevor had to say although I would say his start up cost might put a few people off. I started my business selling my children’s outgrown clothes on Ebay and grew it from there. I would agree its hard work but it does allow you the freedom to plan work around your children. I would also strongly recommend the site Create for setting up your own website shop – really low cost and easy to use.
    best
    Karen

    • Thanks Karen, it’s always good to have a few different opinions on a buisness idea. I think most mums are in your position in that they have to start small on a shoestring budget, so it’s great to know that this is possible for an online shop.

  4. I run an online shop and some respects i love it fits around children, allows me to spend time with children etc on the other hand it can be so time consuming there is no escape as it is all run from home.

  5. First of all I would like to say superb blog! I had a quick question in which I’d like to ask if you do not mind. I was curious to find out how you center yourself and clear your thoughts prior to writing. I’ve had trouble clearing my mind in getting my thoughts
    out there. I truly do take pleasure in writing but it just seems like the first
    10 to 15 minutes are usually lost just trying to figure out how to
    begin. Any suggestions or tips? Kudos!

    • Thank you very much! I don’t think I do centre myself and clear my thoughts prior to writing, actually! If I get stuck I think to myself “what would be the most useful info I could possibly give to my readers?” and I find that a really useful way of getting focused. I always keep a notebook near me so if I have any good post ideas while I’m cooking or playing with the kids I write them down on the spot. As soon as I get a few spare minutes I’ll jot down four or five bullet points around that idea, so that when I have time to actually write the post, I never have to start right from the beginning. Recently I’ve started to do my bullet points in Evernote, which is working very well. Other than that, I think practice helps. I’ve been writing 2 to 3 posts every week for 3 years now and that makes the writing process a lot faster and easier.

  6. North Essex Mummy says:

    What a good post from a really helpful blog every time I get your newsletter I have a read of a few more things and I feel like I good actually get a business of the ground, thanks!

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