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

StoreFour: Continuous Enhancement


Launching an online store requires a great deal of planning and attention to detail. From selecting the theme, to designing the logo. What will be the static content? How about navigation, payment processing, shipping rules, taxes, and a lot more.

Then once that’s been taken care of, comes one of the most important decisions to make at this point of store building: What exactly are we selling here? Is this going to be a general merchandise or a niche-oriented online experience? Who are the customers, and why would they buy from us?

Down the line from that is product strategy: What products should this store showcase and for how much?

As you move from one stage to the next you realize new understandings and, of course, learn new things.

The final ‘product’ just before the launch will never be perfect, and you know it. But does that mean you keep improving while delaying the launch? No! Continuous enhancement must hold a permanent place-holder on your project plan, just as sales and marketing. Failing to do so means choosing to fail in this fiercely competitive landscape.

Since the launch back in May, StoreFour has gone through several reviews, the last being just very recently. The depth and breadth of each review vary, but they all keep asking some essential questions:

  • In exchange for revenue, what value does this store offer?
  • Do current products serve that value?
  • Is there a clear line of sight between the products and the vision/mission of the business?
  • Are customers satisfied? How can we measure that, then improve it?
  • What products to keep, modify and/or delete?
  • What products to add?
  • Are marketing and sales efforts fruitful so far, and if not, why? How can they be enhanced?
  • What are the short and long-term objectives of this store?
  • Are the store’s design, look and feel expressive of its message and brand?
  • Is it easy to navigate and find information?

As you you can see, the questions do not follow a specific order. In these reviews, you capture questions as they arise, randomly. I like to use a large poster and a bunch of colored markers to write down whatever comes to mind. Then gradually move to a mind-map, before finally creating an action plan on a digital tool.

Casually writing down thoughts, questions and ideas allows something interesting to emerge: Clarity!

While just before you’d started your mind was processing everything simultaneously, and rapidly, now it can observe patterns and priorities, reasons and results. It’s much easier now to find answers and chart a new course, or adjust an existing one.

During the last review, which concluded around mid October, I realized that we need to have more focus on our brand, which means redefining or resharpening the concept behind that brand.

While the message has been to ‘Be, Love, Create and Live’, the products didn’t clearly trace back to it. The four dimensions sit on the titles of four product collections. However, when reviewing individual products, it wasn’t very obvious how each one would serve that message.

We finally came to an interesting conclusion: Let’s not try to find ‘Love’, or ‘Create’ products per say, but rather look a bit deeper and ask: Can a ring, for example, help the customer promote love in her or his life? How about a wallet or a bag? does any have a link to ‘Live’ or ‘Create’? And isn’t ‘Be’ a common thread underlying all others?

Of course, another concern is: What is the market pulse for any product we offer? On the one hand, we definitely want to provide true, authentic value. Yet on the other, the business must meet its financial objectives in order to continue serving that value and progressing to even higher levels of success.

From that understanding, and to bring more focus to the product offering, we decided to keep the main theme, but rename the collections: Rings, Bags, Wallets and Digital.

With few specs about what products to choose for every collection, including high-quality, trendiness, and usefulness, we did an extensive research and decided to have only nine products under each collection. This is a major shift from 30 or so products, some didn’t clearly reflect the theme. Now when a customer clicks ‘Rings’, she or he will only see rings under that collection. The same applies to Wallets, Bags, and Digital.

It’s logical and natural after feeling that comfortable with the content of your store to turn to marketing with a renewed will and a fresh determination.

On that, StoreFour now has its Twitter and Pinterest storefronts up and running, with new content and interaction on a daily basis. Facebook already showcases StoreFour, and all are ready from another round of ad campaigns.

We are very pleased to share these exciting developments with our readers, and as always, happy to hear your questions and comments.

Till the next post, be open to new, enriching ideas!

The Wealth Maker

© Image Credit: StoreFour, https://storefour.ca All Rights Reserved

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

Value-based Investment: Introduction


Before Benjamin Graham (1894-1976), investing had been restricted to a special few. People didn’t know that what those ‘special few’ had been doing was merely guess-work!

In order for an individual to invest in the stock market, she or he had to submit to an ‘expert’, who was supposed to know the game of investing: A stock broker, a money manager or a fund manager.

The ‘experts’ had formed an elite circle of influence. What happened within that circle was at best ambiguous to the public. It was not a fair game! Not based on logic and common sense.

What Graham did to stock investing was very similar to what Newton did to physics and astronomy. He’d transformed the practise from one of hype to an activity of research, analysis, logic, decision-making, and of course, risk taking

To be continued..