Challenges of Running an Ecommerce Business


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The idea of starting an e-commerce business sounds quite attractive. The industry continues to grow thanks to how convenient it is to shop online. Instead of walking around in brick and mortar stores, people can order goods without leaving their homes and have these goods delivered at their door. 

Nevertheless, despite how popular e-commerce is, starting a venture from scratch is not that simple. In fact, even well-established businesses face certain challenges.

In case you decide to try your luck with e-commerce, knowing what problems to expect and deal with them could give you an edge. Let’s take a look at some of the most prominent e-commerce challenges.

Challenge #1 – Product Ideas

Coming up with a product idea is usually the first step to take if you want to build an online store. There needs to be a demand for your product; otherwise, you should not expect to make money.

Of course, there is a different approach, which would be coming up with a brand new idea and becoming the first to offer such goods or services. But the odds of that are really low.

Custom merchandise might be that middle ground. The idea itself is not revolutionary, but one can make money if they produce quality products with interesting designs. One of the important things for high-quality products is the material. You need to choose the right partner who will supply custom merchandise for your business.  

For example, if you create custom jackets online with Printify and sell via the dropshipping model, you can expect to make money. 

Challenge #2 – Competition

While researching your product idea, you also need to be mindful of your competition. Other brands are putting just as much or more effort into getting ahead of others. 

If you are an aspiring entrepreneur, it would probably be better to avoid selling in a niche that has too much competition. Look for a market that still has room for newcomers.

Keep in mind, though, that competition is more or less inevitable when it comes to ecommerce. Sooner or later, new and more eager players will join, and you will need to be at the top of your game if you want to retain your status. 

Challenge #3 – Reliance on Suppliers

Unless you plan to invest in manufacturing equipment, warehousing, shipping, and other logistical processes, you will stick to the dropshipping business model.

While the model has its advantages, there is a challenge that can get in the way of running a successful online store. That challenge is finding a reliable supplier.

Since you are not going to manufacture a product yourself, you will depend on your supplier to provide it. 

When things are going okay, you will not have to worry. However, if, for some reason, a supplier cannot provide the goods anymore or has to delay, there is no telling how much these problems can damage your ecommerce business.

While finding a perfect supplier is virtually impossible, you should still do your best researching available options to end up with the best supplier you can.

Challenge #4 – Cybersecurity

A newly-established ecommerce store is unlikely to become a cyberattack target. More often than not, the basic security plugins and other tools that one installs are enough to protect a website.

However, as soon as an online store establishes itself, its competition will likely become unhappy, and they will try to use various attacks, such as DDoS, to take the website down.

It is better to be safe than sorry, so be ready to fight against various cybersecurity threats because they will become a problem sooner or later. 

Challenge #5 – Customer Experience

A modern shopper has certain expectations, and failing to meet them will lead to poor conversion rates.

From 24/7 customer support to different payment options, it is important to ensure that your online store is not missing important elements that make the overall customer experience better. 

Challenge #6 – Price and Shipping

Determining the price is not as easy as one might think. You need to find that balance between not charging too much and still making profits.

Ideally, you should spend time testing different pricing models to determine which ones work the best. Also, do not forget about discounts and how much they can drive sales.

As for shipping, similar to suppliers, you also need to find a company that can be trusted. It would be great if your supplier would also ship the goods, as it would eliminate one problem for you.

Challenge #7 – Returns and Refunds

Returns and refunds are part of the e-commerce business. Handling them can be a chore, especially if you ship many products in a day. Thankfully, there are automation tools that simplify returns and refunds. 

With that said, it is still bothersome and demotivating. Other than automating the process, you should also come up with ideas that will reduce returns and refunds. Free shipping, improved delivery time, and the right product representation on your website are a few examples of ways to reduce the problem.

Buying Your First Business

Starting an eCommerce business is great, but sometimes you want to start with a seasoned system and learn from it while getting into the grind faster. Eventually, you may build your own business and want to sell it to venture towards something different or evolved from where you started. When buying a new business all the tips and tricks in this article will also help you see what needs to be there.

Jeff Campbell

Jeff Campbell is a husband, father, martial artist, budget-master, Disney-addict, musician, and recovering foodie having spent over 2 decades as a leader for Whole Foods Market. Click to learn more about me

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