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Last Updated on March 11, 2018 by Work In My Pajamas
Before you go ahead and start an e-commerce business, it’s best to know what route to take to ensure it’s profitable. There is not just one model for e-commerce businesses, there are several, and if you’re thinking about starting your own e-commerce store, consider the options below and identify which one provides solution to your business needs.
In This Post:
4 E-Commerce Business Models To Consider
The subscription commerce industry is in full flow at the moment, but there’s still plenty of time to get in on the action. Many consumers love the appeal of subscription boxes that get delivered to their door on a set schedule in response to paying a regular fee. Products can range in almost any category, so there’s still plenty of niches that haven’t been done yet. If you look at Auster – you’ll see how unique their e-juice subscription box service is, and it may give you a few ideas when it comes to successfully styling your business.
Many online store owners believe drop shipping is all but dead. However, that’s not necessarily true and you only need to find a good supplier to ensure it works. Drop shipping has been doing the rounds for years now, which is why it’s a little saturated, but there are still many new products that get released regularly so if you can find a decent drop ship supplier, there’s no reason why this model shouldn’t be considered. Drop shipping is used to resell another business’s products; they’ll handle the delivery process, making it one of the most affordable start-ups in e-commerce.
White Label Commerce
White label commerce is similar to drop shipping, but usually, this is a professional business that serves a professional audience. For example, you could resell pharmacy products from a well-known pharmacy. They’ll do all the work, you just need to promote your site and sell their products. This is a profitable business model because of the lower costs that are involved, and most white label businesses can make more than 50% profit on each item they sell.
This business is much harder to start and the initial costs involved are high, but if you have a manufacturer overseas, it could prove to be a profitable business. That is, unfortunately, one of the hardest obstacles to bypass – finding an overseas manufacturer. There are many quality ones available in the likes of China, but there are also many companies around to steal your money. If opting for this route, ensure you do your research and only go with a manufacturer you can trust.
The world of e-commerce isn’t that complex to get started in and, ultimately, it depends on how much of an investment you have to get started. If you want an affordable start-up, opting for a drop shipping business would be the way forward. However, if you have a good-sized investment and you’re looking to make a lot of money, becoming a wholesaler would be the best option.