5 mistakes to avoid when starting an e-commerce business

If you are a newbie in the e-commerce business, starting an online shop might be quite daunting at first glance. But don't panic, we're here to help. Below you'll find a list of the five most common mistakes when starting an e-commerce business and some tips on avoiding them.

Miscalculation of your stock

Inexperienced sellers often miscalculate their stock and are unable to see if they have product overflow or underflow. The biggest problem appears if the products have expiration dates (e.g. food or beauty products) and they are not sold in time. In that case, the company is very likely to suffer loss. If your stock is too low, you can also lose potential profit and customers. Once your e-shop visitors see the note “out of stock”, they will have to go shopping elsewhere.

HOW TO AVOID: Of course, it is impossible to calculate exactly how and what kind of products you are going to sell. However, you can always learn from the best practices which will help you evaluate your stock correctly. A few tips:

• Set automatic reminders to help you know when you have a minimal amount of stock items. Always think about how long it would take for you to get/prepare new products.
• Your business type can also have influence over your sales. For example, if you sell swimming pool equipment, it is very probable that you’ll make the most sales in the summer. Accordingly, if you sell Christmas trees, your sales will grow in winter.
• Apply the “first in, first out” method. It means that the products that have been in your stock the longest, have to be sent out first. This method will help you keep your stock structured and organised.
• When you've been selling for a while, it is highly recommended to look back at your sales history and refer to it when deciding how many products you’ll need for a certain period of time.

Mismanaged product delivery

Another common mistake is mismanaged or not carefully arranged product delivery. A modern buyer is quite demanding and wants to receive a high-quality product quickly and efficiently. If you make your buyers wait for a long time or don’t offer enough delivery options, they will be left disappointed.

HOW TO AVOID:

• Sign agreements with delivery companies before starting your e-commerce business.
• Only work with trustworthy well-known delivery companies.
• Offer a variety of delivery methods, e.g. delivery to your home/office by a courier, pick-up points, etc.
• Offer a competitive delivery time.
• Make sure your buyers can track their delivery to see when they will receive the parcel.
• If you have a traditional brick-and-mortar shop, leave the possibility to collect the order there.

Not enough attention to advertising and social media

It was noticed that many new online shops and other online businesses don’t invest in ads or don’t do it correctly. Ads are extremely important for beginners who don’t have a stable client base. Advertising is one of the most effective ways to introduce your product/business to the public and attract new customers. You can run ads on different platforms, but contemporary buyers find ads on social media the most attractive.

HOW TO AVOID:

• Prepare a marketing/advertising strategy before opening your online store.
• Evaluate which social media platforms will be most beneficial for you and start using them. Try to stay consistent and keep the same username on the same platforms so your account/brand is easy to recognise.
• Give priority to ads on popular social media platforms and consider using Google ads.
• Try as many different ways of advertising as possible. Then carefully analyse the results and choose which marketing channels work best for your business.

The website is not user-friendly

The fourth mistake is not making your website user-friendly and attractive. As previously mentioned, a buyer wants to find what they are looking for very quickly and simply. An aesthetically pleasing design will attract more website visitors and, therefore, potential buyers. However, it's not enough to just make the website look beautiful. It's even more important to make the structure of the website easy to understand and navigate. Visitors will not last long on your website if they can’t browse smoothly and quickly. So, once again, you face the possibility of losing potential buyers.

HOW TO AVOID:

• Applying UI/UX principles to your website by yourself can be quite challenging, so in order to achieve the best results it is recommended to consult with professionals.

Not enough payment methods

The last mistake is wrongly chosen payment options. In order to please modern buyers, you have to keep everything (including the payment process) simple, fast and easy to understand. If a buyer doesn’t find his preferred payment method, it is possible that they will just abandon their shopping cart. This is why you have to make sure to offer the right payment methods.

HOW TO AVOID:

• Decide which countries you are going to target and offer the payment methods popular in those particular locations.
• Offer the possibility to pay with a credit/debit card. It's one of the simplest and most popular payment methods in the world. You'll find it especially beneficial if you sell worldwide as it enables you to accept payments from all over the world. You can also check out our blog post on How to Accept Credit and Debit Card Payments Online.

Opening an online store and starting to accept payments online doesn't have to be a difficult process with the right understanding and tools. Being familiarised with possible risks and learning ways to avoid them, you'll find starting an e-commerce business much easier.

Also make sure to follow our blog because we have many more great tips waiting for you.