Tag: mobile app for ecommerce

Funds for your e-commerce business

8 easy finance methods for raising funds for your e-commerce business

Venturing an ecommerce start up is no different than any conventional commerce start up. The rules applied are the same, particularly with regards to finances. You need to make investment (substantial or not) to start your business before expecting any returns. Many a time it happens that despite having a really sound business strategy, one lacks the finances to launch it. How does one acquire those finances to fuel one’s vision without compromising on most part? Below are a few of those ways

1. Crowdfunding

Crowdfunding websites are frequented by investors looking for business startups asking for startup capital. You need to keep in your mind while campaigning to finance your business that you not only have a monetary goal but also a time goal. Don’t forget to add PDF document detailing your business plan in the description. You can surpass your monetary goal far too easily and early if you do your crowdfunding campaign right.

2. Venture Capitalist Investment

Of late the VCs (Venture capitalists) have been frugal with their purses and start ups haven’t been receiving much funding from them. In 2016’s first quarter, it was found that venture capitalists spent 25-percent less than the previous quarter . Approaching the VCs should be done with complete preparedness, your plan business plan should be detailed enough to tell them what you expect your brand to earn in its first year and in 5 years and so on.

Recommended Blog: 8 eCommerce Strategies for Building Trust through Branding

3. Personal Savings

This is a very safe option to go with as it has no complication and costly application, no interest payment and you don’t have to lose stake in your business. Personal savings are also called as bootstrapping. This is the preferred option when the returns on your money are low and borrowing cost is high. You also have the option of borrowing from your retirement plan (401(k)) but making withdrawal from it before 59.5 years of age can lead to steep penalties. Also it is advisable to not dry your rainy day funds.

4. Angel Investors

People who invest in business without actually concerning themselves with the said business are termed angel investors. They invest money in the business on the promise of a return on investment in a specific period of time. Most commonly friends and kin are angel investors but it is up to you to put your relations in jeopardy should your business fail. To avoid such predicaments you need to keep funds aside every month to repay the angel invested money.

5. SBA Loan

With the current credit crisis, banks are hesitant in taking chances with their money and thus have made the loans provided by the US Small Business Administration a hot commodity. With banks reluctant to take any chances with their own money in the wake of the credit crisis, loans guaranteed by the U.S. Small Business Administration have become a hot commodity. The loans by the US SBA are guaranteed from participating banks, who urges the participating banks give loan to the qualified applicant. But this requires a huge amount of paperwork also the rates and terms are subject to the type of business that’s seeking the loan.

6. Friends and Family

This is one of the easiest ways to acquire finances for your e-commerce start up. But this also may create a huge amount of stress in your personal life. The biggest mistake one makes is approaching the friends and family without a formal business plan in plan in place. You must be prepared with financial projections, the return of investment time window for them before proposing to go in business with their money. This will also establish the fact that you take their money very seriously. You also have to be clear on the kind of investment you are asking for, will it be equity? Will it be a loan? Also, do not forget to clearly state the risk involved.

7. Credit Cards

If you own several credit cards it is one of the easier ways to raise funds. The con of this method is that you have high rate of interests to pay and you can only make the minimum payments with your business’ cash flow. You will have to pay the cards for a significantly long time at a high cost. Other risks include taking hits to your credit score if you fall behind on your payment. If used responsibly though, the credit card can get you extended period for accounts payable to shore up your cash.

8. Home Equity Loan

This option should only be brought under consideration if you have more than 50% of home’s value as equity (i.e. outstanding loan lower than half the house’s market value). A good credit rating can get you a reasonable interest rate keeping your house as collateral. At present rates can be anywhere between 4 and ten percent.

Summary

Acquiring funds for your e-commerce business which includes building an e-commerce app and website is a challenge as the e-retail space is getting more and more crowded and competitive. As an e-commerce start up you can cut down on your investment by using bundled packages like e-commerce mobile app development, that provide you with all the necessary functionality to go up into a business at reasonable price.

6-reasons-local-businesses-need-online-stores

6 Reasons Local Businesses Need Online Stores

Opening an online store is easier than ever. There are dozens of great e-commerce platforms that allow merchants with no coding experience to build up and run complex online store systems and reach customers from all around the world.

Since the use of mobile internet also saw a huge increase in recent years, many business owners decide to optimize their online stores for mobile users. This is another process that’s simplified by latest tech and platforms like MobiCommerce – ecommerce mobile app builder, which enable e-commerce beginners to easily target consumers who use mobile internet.

In this article we will analyze benefits that e-commerce brings to small local businesses and give you 6 reasons why you should add an online store to your business strategy

1. E-commerce overcomes geographic limitations

If you want local store to become global, you should upload its offer to a web server. Traditionally local businesses are targeting customers who live or work nearby, while online stores give them the chance to overcome geographic limitations and present their offer to people all around the world. Of course even online stores have their limitations when it comes to customer reach, and these are mostly determined by country customs and shipping rates. Even with these limitations ecommerce drastically increases business’ customer pool.

2. Online stores cut your HR spending

Online retail business could be easily run by one person. Physical stores on the other hand require at least one person per shift, who can’t leave the store during several hours. Bigger stores also require additional workforce that will cover security, bookkeeping, storing and merchandising tasks. Online stores that are run by production companies, don’t even need to hire additional staff.

3. Online stores can use less expensive ways of promotion

Internet retail entrepreneurs are usually much more open to new technologies, which means they use all benefits digital marketing brings. Online merchants usually share their offers directly on social networks and attract more customers with less expensive marketing strategies which include the use of search engine optimization, Google AdWords, local business mobile apps, Facebook Ads etc.

4. Online store requires less space and guarantees a smaller rent

E-commerce works on completely different premise and the whole project can be easily run from home or a garage. One of the reasons for this, is the fact that these stores use website’s product pages as their exhibition area. They also don’t need bigger storage space, because customers who shop in online stores are accustomed to shorter or longer waiting periods. This means that store owner can use this period to obtain ordered item or even to produce it (if the store is connected to production plant). Physical stores on the other hand need to have all of their goods ready and packed, because customers expect to walk out from the store with a product they just purchased.

5. They are open 24/7

Internet works 24/7, and online stores are no different. The moment after your neighbor goes to sleep, some college kid is just making a break from studying, by browsing stuff he/she would like to buy. This brings benefits to both merchants and customers. Merchants will receive more orders, and customer won’t need to rush after work or school and think whether their favorite shop is going to close.

6. Online stores save customer’s time and money

Most online stores offer free shipping, at least in local area, which drastically decreases customer spending. Location based stores require customers to spend time, money and gas in order to buy their favorite item, while online stores bring goods directly at their door. That’s probably one of the reasons why ecommerce is one of the fastest growing internet businesses in recent years.

In the end we should also mention a few disadvantages online stores come with. First and the most important lack of online shopping app concept is the fact that customer can’t see the item before it arrives to their address. Merchants solved this puzzle by uploading sharp, high-resolution imagery and providing extensive information about the product on their product pages. Some of them went few steps further introducing 360 degrees product view, adding links to manufacturer’s website or sending product samples to potential customers. This and many other similar practices will make your online store more competitive and popular among consumers.