The Pros And Cons Of Starting An eCommerce Business

Mar 1, 2014 by Camille Brenkwitz


Everything has its pluses and minuses and starting an online eCommerce business is no exception. eCommerce can really pay off for your business, but it does demand your time and commitment. Having a good understanding of what you're getting yourself into is essential, so we explain some pros and cons, below.

Pro: Low Barrier To Entry

You can start an online business without having to get venture capital or taking out a business loan. If you are willing to learn how to set up your own eCommerce store, then you are left with just the monthly cost of hosting your website, which is between $5 and $25. There will also be a yearly domain name renewal for your website, which can be as low as $5.

Con: You Will Start Off With No Traffic Or Customers

When you first set up a new online store, the internet will not yet know that you exist. To attract customers from across the web, you will need to do some marketing to bring in traffic to your eCommerce site. You can attract customers from search engines, social media sites, other websites, and more. Doing this on your own will take a lot of work, potentially quite a bit of money, and even more time before you see results. One way to speed this up is to hire services to help you with social marketing, SEO, email marketing, etc.

Pro: Your Potential Market Can Be Very Large

Being online means your customers aren't limited to your local geographic area. They can come from any country in the world. There are over 2 billion people using the Internet and the number is growing every year.

Con: You Will Have A Lot Of Competition

Increasing your traffic will involve finding ways to either beat your online competition or finding ways to sidestep them. One of the best ways to sidestep them is to find a way of making your brand unique so that it stands out from the thousands of other businesses. This will likely require some very clever marketing tactics.

Pro: You Don't Have To Keep An Inventory Or Do Any Shipping

One option to avoid managing inventory or shipping is to do drop shipping. There are businesses who maintain large inventories and will ship physical goods to any address you specify. When a customer buys an item from your store, you then place an order with the dropshipper and have the item shipped directly to your customer.

eCommerce has the potential to be a very large pro for a business, given that time and investment in the system are monitored closely. There are also a number of ways of dealing with the con arguments made in this article. As you gain more experience, they will no longer be quite the barrier they seem to be when first starting out. Here at PayStand, we are huge fans of eCommerce.

PayStand can give your new business a jump start when you take advantage of our full eCommerce solution. Contact us today for more details.

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