As the world becomes more digital, online transactions are increasingly becoming the standard for doing business. For entrepreneurs, the eCommerce industry offers a lucrative opportunity to maximize earnings while minimizing time investment. In short, starting online eCommerce business is where it’s at!
This article will serve as a guide into the world of eCommerce with insights on how to launch a successful online business. Here, we’ll learn different eCommerce business examples and find the best platforms to launch a business. By the end, we’ll have a clear understanding of the eCommerce industry with practical steps on how to succeed in our eCommerce venture.
Let’s get started!
eCommerce is a growing industry, with online transactions becoming the new norm. There are six different eCommerce business examples, each with pros and cons regarding ease of starting, resources required, and profit margin. Best eCommerce platforms to launch a business: Shopify, WooCommerce, Wix, Etsy, Amazon, eBay, Facebook Marketplace, and Facebook Shops. We need winning products, reliable suppliers, efficient product importing and order fulfillment processes, and scaling strategies to succeed in dropshipping.
What Is eCommerce?
eCommerce is shorthand for the term ‘electronic commerce.’ It is an online business model that’s steadily growing in the world of retail. In fact, it’s forecasted that by 2026, 25% of global retail sales will come from the online segment.
Every purchase we make online or digitally falls under this category. More retailers are going online to offer convenience and to reach an even larger customer base. Moreover, online businesses have the ability to reach customers worldwide in just a few clicks. So, what are examples of online businesses?
6 eCommerce Business Examples To Get You Started
So, we’ve learned what eCommerce is. Now, let’s explore the different eCommerce businesses we can venture into.
Wholesaling & Warehousing
Wholesaling & warehousing involve buying products in bulk from manufacturers and keeping them in inventory. Because we’re buying in bulk, we buy items at discounted prices and sell them to retailers or directly to customers at a marked-up price. We can get better deals and thus earn a significant profit.
Since we buy products in bulk, we can cut costs and offer competitive prices and still earn a significant profit. We also have control over the inventory we hold since we are purchasing items directly. However, there are greater costs and management efforts regarding holding a lot of products in stock. Plus, we have to set up our logistics and fulfillment process to manage orders.
- Ease of Starting: This will require industry knowledge, connections, and a lot of resources.
- Resources Required: Warehouse space, inventory, technology infrastructure
- Profit Margin: It’s possible to make 15%-30% in profit, but this can increase depending on market niche and pricing.
Manufacturing & White Labeling
Manufacturing/white labeling is an eCommerce business example where we partner with manufacturers to produce products under our brand and selling them online. In this model, we can customize existing products from other brands (white labeling) or create new ones (manufacturing) using a manufacturer’s capabilities and resources.
We can have better control over production and potentially higher profit margins since the products come directly from us. For the same reason, we have more room to customize and improve our branding. However, we will need a lot of initial investment in terms of time, money, and effort. We’ll also have to oversee the production process and operations.
- Ease of Starting: It will require a lot of preparation and planning since we need to establish a brand, strategize our marketing, and find reliable manufacturers to create a good quality final product.
- Resources Required: Marketing channels, branding & packing efforts, quality control, and manufacturing.
- Profit Margin: This depends on how much control we have over manufacturing costs. The cheaper we can create products, the higher our profit margin.
Dropshipping
Moving on to dropshipping, this eCommerce business example involves selling products without holding inventory. Instead, we buy products from suppliers after a customer has made a purchase. We can rely on a third-party source to handle shipping & delivery, order fulfillment, inventory management, etc.
Now, there are also existing dropshipping automation tools that take most of the work out of our hands. With dropshipping automation, we can streamline our process and scale our business easily. We can automate order fulfillment, inventory management, price monitoring and optimization, and product imports.
Dropshipping is an ideal eCommerce venture especially for beginners because it has low startup costs. It’s also accessible, and location independence allows us to work from anywhere. Profit margins can vary at first, but with price optimization tools, we can build up a highly profitable dropshipping store.
- Ease of Starting: It’s relatively accessible, affordable, and profitable for beginners.
- Resources Required: Reliable suppliers and a trusted selling platform.
- Profit Margin: Depending on the products we carry and how we manage costs, we can potentially earn around 30%-60% in profit.
Print-On-Demand
A Print-On-Demand eCommerce business is when products such as clothes, bags, accessories, home decor, etc., are customized based on customer requests. We work with suppliers/manufacturers to handle everything from digital printing to order fulfillment and shipping. Similar to dropshipping, we don’t have to purchase items unless an order has been made.
We don’t need to hold inventory since we work with suppliers and manufacturers. There are also lower startup costs since we only make orders after a buyer’s purchase. However, because we rely on third-party suppliers, we have limited control over the production and quality of products.
- Ease of Starting: This will be highly dependent on finding the right suppliers and manufacturers to get started.
- Resources Required: Design expertise/experience, reliable suppliers/manufacturers.
- Profit Margin: This can vary depending on pricing strategy, cost of goods, marketing efforts, and customer demand. Although there are lower startup costs and minimal risks, this model also has lower profit margins.
Subscription Service
Unlike the typical eCommerce setup, a subscription service is a business model where customers subscribe to receive regular deliveries of products or services at recurring intervals. Instead of making one-time purchases, customers commit to ongoing payments for the subscription.
One of the best things about a subscription model is having predictable recurring revenue. Also, knowing just how many subscribers we have makes it easier to plan and schedule orders and deliveries. The hard part is attracting subscribers and making sure to drive consistent value so they don’t cancel their subscriptions.
- Ease of Starting: It’s harder to get started since we need to plan and implement a subscription management system, establish a fulfillment process, set up a platform, and market our offerings.
- Resources Required: Industry knowledge, a functional website or eCommerce platform, marketing tools, subscription management platform.
- Profit Margin: Profit margins in this model can vary depending on the number of subscribers, retention rates, pricing, etc.
Buy & Sell On Marketplaces
Another eCommerce business example we can consider is buying and selling on marketplaces. Marketplaces, such as eBay and Amazon, are online platforms where we can find products from multiple different sellers and shops. These marketplaces serve as intermediaries, facilitating the exchange of goods or services between multiple parties digitally.
Setting up shop in an established marketplace gives us immediate access to a large customer base. We also don’t need to worry about the backend since we adapt the existing systems and infrastructures of the platform. But, having multiple sellers in one platform creates intense competition, and it’s also harder to stand out because of limited branding/customization options.
- Ease of Starting: It’s relatively easy to get started on a marketplace since we simply need to set up shop and conduct business within their existing infrastructures.
- Resources Required: Product inventory, customer support, and knowledge of how to use the platform.
- Profit Margin: We can earn a significant profit of up to 40% or more by buying low and selling high. Find cheap items on one marketplace and sell them at a marked-up price on a different platform.
The Best eCommerce Platforms To Create Your Business
Now that we understand what eCommerce is and the business examples we can use, it’s time to get into the where. As in, where can we launch and set up our eCommerce business?
eCommerce platforms, otherwise called selling channels, basically refer to an online system or software that enables us to sell products or services over the Internet. It’s a virtual storefront for businesses to showcase their offerings, display their products, handle customer orders, and process payments.
There are several eCommerce platforms we can use to launch our online business. Different platforms offer different features, and it’s up to us to determine which suits our business goals best. Here, we’ve narrowed down a list of the best and most reliable eCommerce platforms:
Shopify and WooCommerce are customizable platforms where we can control the design and functionality of our online store. Wix is a website builder with pre-designed templates we can use to quickly set up our shop. Likewise, Facebook Shops enables us to create online stores with customization options for appearance, branding, and product organization.
Etsy, Amazon, and eBay are online marketplaces. Since these are platforms where multiple sellers and buyers are already on, they offer free organic traffic for our business. Likewise, Facebook Marketplace falls under the same category.
For beginners, a profitable business model we can pursue on any and all of these platforms is dropshipping. And, with eCommerce solution providers like AutoDS, we can easily automate our dropshipping process no matter which one we choose to work with. We can scale our business using features like price monitoring, price optimization, inventory management, and order fulfillment.
How To Start An eCommerce Business: A Brief Overview
If we really want to launch an eCommerce business, we need to do more research to find out what works for us. Let’s use dropshipping as an example as we go through each step of how to get started in eCommerce.
1. Research & Find Winning Products
Product research plays a pivotal role in the success of a dropshipping business. Through this, we can better understand which products are popular and what our customers want. By conducting thorough research, we increase our chances of building a profitable and sustainable dropshipping venture.
Here are some product research methods we can employ to optimize our dropshipping business:
- Spy on the competition
- AutoDS Winning Products Hub
- Product Finding Blog & Sell These Now Playlist
- Analyze Supplier Best-Seller Sections
- AliExpress Dropshipping Center
- Keep Track Of Social Media Trends
- Analyze Engagement Rates On Facebook Product Ads
Furthermore, the AutoDS Winning Products Hub is a convenient tool that helps us find profitable trending products. It eliminates steps from product research while ensuring we have the best products for our dropshipping store. One key feature of this tool is its Product Analysis.
The Product Analysis section provides information about the target audience, including the potential profit we can earn from selling it. This is great for us to know whether or not a particular item suits our brand or the market we’re looking to target.
We can also find additional insights into our competitor’s Facebook ad and a breakdown of the product page on their website. It’s helpful to know how competing sellers are advertising and pricing their products. Plus, we can also use this information to backtrack and identify which suppliers can give us good deals with great margins.
2. Select A Reliable Dropshipping Supplier
Once we’ve found winning products to add to our online store, it’s time to find a reliable supplier to source these products from. As dropshippers, we rely heavily on our suppliers with regard to not only the quality of products but nearly every step of the process.
Here are key factors we should be looking for to determine whether a supplier is trustworthy:
- International warehouses
- Practical shipping, return, and payment policies
- Positive reviews
- Wide product range
- Affordable pricing
- Reliable shipping couriers
- Excellent customer service
Based on this list of factors, we’ve named some notable suppliers we can consider for our dropshipping business:
The AutoDS Warehouse serves as AutoDS’ personal repository, where we can source products for our online dropshipping store. With this supplier, we gain exclusive access to private suppliers, granting us a competitive edge over competing dropshippers.
Additionally, when we obtain products from the AutoDS Warehouse, we have the ability to incorporate personalized logos into the items we sell. Having this helps us strengthen our brand and enhance recognition among our customers. Plus, this supplier offers discounts we can extend to our buyers and use to generate greater profits with each sale.
3. Import Products To Your eCommerce Platform
We now know how to find the best products, and we’ve learned how to determine the right suppliers to work with. Now, how do we import products into our chosen eCommerce dropshipping platform? There are two ways: manual and automatic.
First, let’s discuss the manual method of importing products. This option requires more time as we have to go directly to our supplier’s website and duplicate the title, descriptions, and images individually for each product. It’s a tedious and repetitive process, taking time away from us working on our business.
On the other hand, we can automate our product-importing process by investing in tools that do the work for us. AutoDS’ product importer automatically extracts products from the supplier’s website, either individually or in bulk, and uploads them to our store with just a few simple steps:
On the AutoDS platform, simply find the “Add Product” button on the top-left portion of the page. Select whether we want to add just one product or multiple products at once.
To add products, input link/s in the dedicated space and decide whether to keep it as a draft for optimization first, import directly and immediately to our shop, or schedule it later.
We can optimize product information prior to importing them into our store. Here, we can edit product information, including titles, descriptions, images, specifications, and prices.
Once ready, we simply click ‘Save & Import’, and it will automatically be published on our dropshipping store at any supported eCommerce platform.
4. Fulfill Customer Orders Quickly
Order fulfillment is a critical part of any eCommerce business and involves the process of receiving, processing, and delivering customer orders. By fulfilling orders accurately and on time, we can ensure a positive customer experience and market differentiation. Efficient order fulfillment streamlines operations, cuts costs, and improves the business’s reputation.
While necessary, fulfilling orders can take a lot of time. Opting for automated order fulfillment methods makes it easier and faster for smoother transactions. AutoDS offers two tools that can help us automize our dropshipping services.
Fulfilled By AutoDS is an order fulfillment solution that simplifies processing returns into a one-click method for zero hassle. Since it uses AutoDS buyer accounts, all we need to do is load balance, and the system will use that to fulfill our orders. On top of that, AutoDS provides unlimited credit, meaning we can sell (and earn!) without limitations.
Meanwhile, AutoDS’ Automatic Orders uses our buyer accounts and payment methods to fulfill orders. Plus, it ensures 100% accurate order processing and promptly updates information, eliminating concerns about sending items to incorrect addresses. Additionally, both tools provide tracking updates, enhancing the overall customer experience.
5. Scale Your Dropshipping Profits
Once we’ve set up our dropshipping business, the next step is to scale. Dropshipping automation is a strategy that helps us optimize our business process for maximum efficiency and profitability. It benefits online dropshippers because it allows us to focus on strategizing and growing our business.
AutoDS is an all-in-one dropshipping automation tool that enables us to scale our business efficiently. The platform has multiple features we can take advantage of in order to enhance and streamline our processes:
- Quick product imports
- Complete order fulfillment
- Automated product research
- Price/stock monitoring
- Easy inventory management
- and more!
By utilizing AutoDS and its plethora of features, we optimize our operations and empower ourselves to focus on strategic growth while we grow our business.
Frequently Asked Questions
What Are The Different Types Of eCommerce Business Models?
There are four types of eCommerce business models:
- Business-to-Business (B2B) eCommerce
- Business-to-Consumer (B2C) eCommerce
- Consumer-to-Consumer (C2C) eCommerce
- Consumer-to-Business (C2B) eCommerce
Which eCommerce Business Example Is Best For Beginners?
There are various options available if we’re looking to get into eCommerce. However, dropshipping is ideal for beginners because it’s a low-cost and low-risk venture. You don’t need a lot of capital, and there’s less risk of a huge financial loss since we rely on sure purchases before proceeding with orders to our supplier. It’s definitely a good and easy way to launch a business in the eCommerce market.
How Do I Choose The Right eCommerce Business Model?
Choosing the right eCommerce business model comes down to deciding who we want to serve as customers, aka our target audience. We also need to look at what kind of products we want to offer, what resources we have, and what our goals are for our business. Besides, we’re allowed to experiment with different models to find out what suits us best and make pivots when necessary.
Conclusion
Congratulations! We’re now steps closer to starting our eCommerce business. However, learning about different eCommerce business examples and platforms is just the starting point. It’s time to decide how to take our ideas and goals to the next level.
Remember, it doesn’t stop here. Continuous learning is key to making it in the eCommerce industry. Let’s broaden our knowledge using these articles as guides for our next steps:
