How to Choose the Right Product


In e-Commerce, products are represented by images, multiple images that aim to show site visitors how the product looks and feels, how it serves the need it is intended for, and how it is superior to other, similar products on the market.

As you can see, this involves several skills, tools and decisions. The first and most important decision must answer the question: Will this product appeal to the visitors of my site, and does it serve their needs effectively? The next question concerns the price: Is the product priced competitively, while still making a profit?

If you’re like many new e-Commerce entrepreneurs who decided to open their own online stores on platforms such as BigCommerec™ and Shopify™, you might have considered drop-shipping as an alternative to traditional approaches.

The idea is innovative, yet simple. Instead of keeping inventory and worrying about shipping to your customers, a drop-shipping model takes care of that. The products on your online store come from suppliers from all over the world, who, once an order is placed, process the request then ship directly to your customers.

In addition to saving time, energy, space and money, drop-shipping makes adding new products or deleting old ones a fun exercise. All you have to do is brows through a supplier’s catalogue, pick the items you like, modify few things to make the product fit your overall theme and categories, then push the product to your store, and it becomes ready to view, and hopefully sell.

But how would you know that what you have chosen meets your requirements? To begin with: Do you know your requirements? Before seeking anything in life, we must ask three questions: What, why and how. Requirements answer the ‘what’ question. But in order to get to the right answers, we need to have a clear idea of what the business is about; what values it serves, and what objectives it aims to achieve.

One of the collections in my online store, storefour.ca is named Digital. For any product to fit into that collection it must operate digitally, or has a digital aspect to it. Here’s an example:

So knowing your requirements is the first step to selecting the right product. The second is knowing the supplier. The e-Commerce landscape is so crowded. Finding the right supplier takes doing your homework diligently: reviews, returns, age on business, location, complains. The list is long, but you will figure it out based on what you’re looking for.

Now you know what you want and where to get it. The third step is to find the right channel and process to communicate with the supplier and secure the product.

If we go back to the drop-shipping model, the e-Commerce platform you use plays a key role in helping its merchants find credible suppliers as part of its service. Shopify™, for example, recommends an app named Oberlo™, which connects you to a pool of previously verified suppliers, making your life a lot easier. Yet, to be on the safe side and save your business future hassles, keep doing your research even on recommended suppliers.

The point here is to use all resources available to select and show the best product on your store.

More details on this in our next post, stay tuned!

The Wealth Maker

©Article Image Credit: https://storefour.ca

A new Venture


The world of e-commerce is an exciting, and potentially rewarding one.

Recently I decided to delve in, and went through the process of building an online store.

The result was a decent place for visitors to Be, Love, Create and Live. That is the theme, with products that promote a vibrant, balanced lifestyle; pertaining to the soul, the heart, the mind and the body.

My objective is to grow StoreFour to at least 20K Canadian dollars of net profit every month; ambitious yet achievable.

Here is something you can view and get from StoreFour right now:

 So far, I’ve found that bringing interested customers to the storefront and convincing them to actually buy something is the real challenge of succeeding at e-commerce. Building the store, finding the right products, designing, putting and tweaking the processes, all of that was in my turf, and did enjoy it a lot.

That said, as I’m gaining more understanding of e-commerce marketing and sales secrets through learning and doing, I’m getting the hang of it, and gradually enjoying it as well 🙂

A key element of “customer conversion,” which refers to convincing a visitor to buy, is first to drive the right traffic to your website, then offer something that interests the visitors in terms of quality, usability, and price.

It takes consistent monitoring of analytics and learning how to spot the insights and apply their wisdom in action. It also requires getting busy with Search Engine Optimization (SEO), advertisement, and building a good customer list.

Will keep my readers posted on the progress and would appreciate your feedback on any aspect of this new venture…

Keep learning and growing!

Yaman, The Wealth Maker

 

Value-based Investment: Wonderful Businesses


 

This is the heart of our value-investing discussion. If you haven’t already, I suggest you go back and read the previous articles in this series.

A Wonderful business is one that delivers value to its customers, shareholders, and employees. The role of the management of such business is to balance those interests, yet satisfy them to a reasonable degree.

This leads us to a key element in spotting a wonderful business: Its management. Who is calling the shots? How does the management maintain a positive balance sheet? What are their pay packages? Are those in line with the financial temperature of the business? We could spend hours asking such questions. The bottom line is to investigate the managing team, meet some of them if possible, ask the tough questions. You should be satisfied with their management style and their track record, before you give them your hard-earned money.

Next, or parallel to that, you need to roll up your sleeves for few hours, or maybe days, to research the financial health of the company. The first station your research train will stop at is the annual report. Reading and understanding annual reports gives you a tremendous edge, yet it’s not easy at all. Studying the financial history of the company gives you a good idea concerning its future. The most important annual report to dig through is the last one. But you should have a look at the annual reports of at least the last five years.

Questions you may want to ask, and find solid answers to, are:

  • Have the earnings been growing quarter over quarter, during the last five years?
  • Has the compensation of employees, especially the executives, been in line with the growth of the business?
  • What is the market capitalization? Is it a small cap or a large cap, or something in between?
  • Does the business pay dividends to the shareholders? What’s the dividend percentage of the share price? Look for something above 2%
  • Are their strategies in place to reduce the cost of production without affecting the quality?
  • How much debt does the company carry from quarter to quarter?
  • What is the net Earning/share (EPS) for the last four quarters, the last five years, and maybe 10 years?
  • Has the EPS been growing or declining?
  • What is the current Price / Earning (P/E) ratio? You need that to be as low as possible. Be careful of any P/E above 20
  • Are there any legal issues facing the business?
  • How does the business compare to its competitors in terms of market share?
  • How much does the business spend on research and development? A retail chain must have a different figure here than a pharmaceutical company, provided everything else is the same
  • Simplicity is another factor. Although it’s not very easy to find out, but it’s worth the research. The more complex the business is, the more prone it is to problems down the road. The reward of simplicity is a low-maintenance business. As an intelligent Investor, you should not fall in love with the business. Even if you love technology, for example, this is not enough reason to buy technology shares, unless they prove to be wonderful businesses!

What you’re looking for is a stable business, which has been growing nicely for quite some time, and which has good, honest, and capable management. A management team that has been successful in making that business a vehicle to delivering real value.

The key words here are: Stability, sustainable growth, ethics, value, and it won’t harm to have some fun along the way!

To be continued…

The Wealth Maker