How to set up an online store

Chris Barling, Start Up Donut expert and founder of our sponsor Actinic has published a second book, which is entitled Selling Successfully Online – Over 300 Top Tips for Running an Ecommerce Website. It’s full of useful tips and essential knowledge gained from Chris’ 15 years in online sales and marketing.

We’ve got an extract from the book below and a chance to win one of five signed copies. Alternatively, you can download a free PDF of Selling Successfully Online from the Actinic website.

1 First, get informed

The more you know, the better decisions you will make. So look out for articles about ecommerce in the press, attend a trade show or two, and talk to people who are selling online already. Make sure that you shop online whenever you can and keep your eyes open when you do. Search on Google for related themes such as ‘ecommerce’ and ‘shopping carts’, find some informative websites, and read up about the subject.

2 Make sure ecommerce is right for you

If you are selling goods that customers do not need to touch, taste or smell before buying, at a fixed price, then the web is the place to be – especially if your products are hard for customers to find. The web can offer your customers the convenience of being able to shop when it suits them, without having to travel or queue. And it offers a level of automation and low start up investment that keeps your costs in check, so you can offer keen prices into the bargain. You can check out the competition by looking on Google for some of the products you plan to sell.

3 Get your offering right

Think about why people would want to buy from you. You need to provide them something which they believe will offer more value than the amount they pay, and which you can supply at a profit. It’s as simple (and difficult) as that.

4 Keep control of the cost

The less you spend on technology, the more you can afford to spend on promoting your site and bringing in customers. So if you are just starting up look for a solution that is low cost and can do what you want to begin with, but offers an upgrade path for the future.

5 Use technology that already works

Use technology that works, not stuff that’s a masterpiece in progress. Why bother debugging software from some start-up, when you could be using an application that is already working on thousands of online stores?

6 Make sure everything is reliable 

Your online store will be able to take orders 24 hours a day – but only if it is available. Depending on whether the cart is ‘hosted’ you may need a third party to host your website. Either way, make sure that your store will be very reliable. Get a personal recommendation from someone you know, or ask the supplier for their availability figures, and what they do to make sure that these stay high.

7 Consider the ownership issue

We have heard horror stories about the treatment that some merchants have received from their ecommerce providers. If you buy a solution that is fully hosted across the net, you are dependent on your provider, and the business that you painstakingly build could be gone in a flash. This can happen if the supplier has quality or financial problems, or the supplier falls out with you. Check out any problems by searching on the internet before committing your future business to someone that might not be trustworthy. The lower start up costs that you should achieve with a hosted online solution (known as software as a service or SaaS) make particular sense for brand new businesses, but need more careful consideration if you are already established. Look at the longevity and track record of the supplier before making your decision.

8 Make security a priority

Both you and your customers need to feel confident that you have adequate protection against hacking and fraud. Choose an ecommerce solution that takes this seriously and has a well-developed track record. The industry standard is PCI DSS (Payment Card Industry Data Security Standard) so make sure that your provider is fully equipped in this field.

9 Choose an appropriate payment solution

In virtually every market, it’s vital to be able to take card payments. Look for a range of well-priced options to meet this need.

10 Decide: marketplace or own web store?

The last few years have seen the rise of ’online market places’ such as eBay and Amazon. You can use their technology to start selling straight away and more importantly, they will deliver visitors to your store from day one. These are major benefits and are the reason why huge numbers of merchants have started selling online through this route. Many merchants with their own websites also sell through Amazon, eBay and others. The benefits are clear, so it’s worth outlining the issues:

• The first is cost, where listing and transaction fees will take a significant proportion of revenue.
• The second is control, where you must adhere to strict policies and your business can disappear overnight if you are deemed to have stepped out of line.
• The final disadvantage is slightly ironic. Because it’s so easy to start up, there is a constant stream of new competitors, many of whom are running their business in the evenings. The most common approach of these start ups is to compete on price, which puts pressure on margins for everyone. While some of these businesses do not last long, there is a constant stream of new ones to take their place. For these reasons we will mostly consider running your own store here, but marketplaces should be considered and some of the advice applies equally to running marketplace-based businesses.

11 Do it yourself – or not?

If you decide to run your own store, then you need to decide whether to set this up yourself or to use a professional. The decision whether to go it alone will depend on a variety of issues. These include your budget; your level of technical knowledge and familiarity with the internet; the availability of technical staff within your organisation; the amount of customisation you require; the amount of time you have available; and whether you enjoy playing with technology. An ecommerce package can enable you to deploy a good-looking, fully functional site quickly, and at low cost. A web designer will add a professional finish and enhanced features that can generate confidence and boost sales. Either way, make sure the finished site is easy to use for both you and your customers.

12 Don't forget sales and marketing

It is all very well opening your shop on the internet, but you need to think about how customers are going to find you and how you will persuade them to buy.

Competition results

We asked:

What is your best tip for making sales online?

Congratulations to our competition winners:

• Sarah Garcia
• Bronwyn Durand
• Sarah Stone
• Elwin van der Laan
• Peter Van Vliet

Thank you to everyone who entered.

The T&Cs

Entries will only be accepted via the Start Up Donut website. To leave a comment, you will need to sign in or register; Registration is completely free. Multiple comments from the same user will only be entered once and comments will only be published at our discretion; no links will be allowed. Inappropriate or offensive comments will not be published. Comments submitted between 4 July 2011 and 13 July 2011 (17:00 GMT) will be entered into a draw and five winners will be picked at random. The winners will be contacted on 14 July 2011 using the email address they provided when they registered on the Donut websites. If the prize is not claimed by 28 July 2011, another winner will be selected. The prize is one copy per winner of Chris Barling’s book Selling Successfully Online; there is no cash alternative.

Competition terms and conditions