There's little arguing with the economic impact e-commerce has had on domestic commercial activity in the past decade. Each year online retailing continues to mature and evolve, providing customers with new and unique ways not only to search for products and services, but to buy them as well.
Industry growth has been vast and consistent in recent history. In fact, business-to-consumer global e-commerce sales will reach more than $1.7 trillion by the end of 2015, eMarketer says, with a primary driver of the 20 percent yearly increasing attributed to the expanding mobile and online user base in emerging markets. Total sales are predicted to pinnacle $2 billion by 2016.
In North America, sales are forecasted to reach $482.6 billion and $538.3 billion by the end of 2015.
Setting up an online store: The time is now
Given the aforementioned information, small-business owners who haven't yet established an online market presence are doing themselves more harm than good, especially as e-commerce sales continue to increase each year. The idea of creating an online platform that displays a company's inventory can be daunting for some, but merchant owners would be remiss to not take advantage of this rapidly expanding market.
Small-business owners have a few options when it comes to setting up an online store:
- Online marketplaces: Websites like eBay and Amazon are online marketplaces, which come with benefits as well as drawbacks. On the plus side, businesses can have their products found on a widely searched marketplace. On the other hand, these platforms typically charge fees for products sold. What's more, businesses often have to compete against other companies who have the same idea.
- E-commerce platform solutions: E-commerce platforms are good options for new businesses because they do a lot of the behind-the-scenes work for local businesses. These solutions host customizable storefronts that stand alone from other companies'. This option may work well for the hands-on but not-so-tech-savvy business owners, although it costs more than the larger marketplaces.
- Create a site from scratch: The weekend warriors of the small-business world may liken this option to an unfinished 1965 Hot Rod in their garage: a work in progress. Merchant owners who decide to take this path will have complete control of the user experience from beginning to end, whereas that control is sacrificed with either of the above options. Business owners will need a handful of things to complement its online store, including: a Web domain, Web hosting, a dedicated IP address, SSL certificate, a shopping cart system and a verified payment processor.
While the entire process can be a lot of work, it may pay dividends to completely customize the website to fit a business's needs. A merchant owner will have full control and access on the site, and choosing the right business partners, such as a payment processor, can have a significant and positive impact on bottom-line revenue. While larger marketplaces and e-commerce platforms offer certain benefits, a business can maximize it's earnings potential by partnering with the right third parties.
Focus on e-commerce security
On the surface, it may seem like setting up shop online is a massive investment. However, current business owners shouldn't have too much difficulty expanding their operation online if they've been in the field for some time. Starting a business online parallels a brick-and-mortar setup in many respects, which bodes well for small businesses.
Similar to in-store payment processing, security for e-commerce payments needs to be a top priority. The right payment processing partner will be fully compliant and monitor customer transactions, ensuring top-notch protection around the clock. Merchants committed to creating their own e-commerce website should consult the Federal Trade Commission's E-commerce guide and the U.S. Small Business Administration's Online Business Law to ensure they're meeting federal regulations and security measures.