Deciding to start an e-commerce business is a tough and intimidating decision, particularly when you’ve decided to do so without taking out a loan to help cover the costs of manufacturing, office space, and labor. Although starting your new online company on purely working capital can seem ludicrous, in the long run, it may actually be more profitable. Below, we’ll discuss how entrepreneurs can build a profitable online business without taking out a loan.
Whether you plan to sell tangible products such as office supplies or digital products like SEO services, you will first need to sit down and develop the ideas into a well-organized plan. Keep in mind that idea development isn’t only limited to creating an attractive business model and personality, it is also critical to painstakingly explain the ins and outs of your products or services, including:
- Who are your products developed for?
- How they will improve the lifestyle of your clients and customers?
- What those products and services will look like, include, and be manufactured of?
- Who will conduct the manufacturing?
- How will they be marketed to your customer?
- How will your customer ultimately purchase these products and services?
Newly formulated companies with strong presales capabilities have been proven to consistently win 40-50% of potential leads, but how do they do it?
With these higher-than-average sales rates, it’s clear how important presales is to revenue generation. Instead of using a loan to develop a prototype and share it with your target audience, start your presales process by identifying your leads, then do research on what their perfect product or service would be. Use their feedback and your own personal research to adjust the original vision of your products and services. Then, test the idea with tentative designs using computer animation or drawings and solidify the manufacturing specs. Once you’ve drafted this information, share it with your potential clients to get more feedback.
Overcoming the Fear of Failure
Starting a company with little-to-no financial backing can be extremely intimidating. As such, it’s not uncommon for entrepreneurs to have an inherent fear of failure. Overcoming this fear of failure is one of the many hurtles you will leap over as you step into the role of an established entrepreneur. Keep in mind that failure is subjective, and that reasonable clients will always give you the opportunity to correct any mistakes you make along the way. Keep in mind that in order to succeed, you will also fail dismally. Don’t believe us? Take a look at Sir Richard Branson, one of the world’s most influential philanthropists and owner of the Virgin Empire, who was a high school dropout. On the other hand, Warren Buffet was rejected by Harvard University. With these examples before us, it is safe to say that failure is an impassable avenue to success.
Marketing on a Budget
One of the most challenging (though not impossible) aspects of starting an e-commerce business without a loan is finding marketing avenues and tools to spread the word about your brand. Thankfully, the ease of the internet has made it possible to advertise your brand using free tools such as YouTube, social media platforms, your company website, e-commerce software, and more. Because content marketing is such an effective tool, and can be created by entrepreneurs themselves without an investment, it has quickly become one of the most popular marketing avenues today. In addition to content marketing, it is important to network with other businesses in your community, offer rewards for customer referrals, and generate some effective (but budget-friendly) business cards.
Overall, building an e-commerce businesses without a loan is entirely possible if adequate pre-planning is done. Before launching your product, finalize your idea development and work diligently on presales to ensure your goods and services are needed by your target demographic. Then, overcome the fear associated with launching a new business and begin developing a marketing budget to keep you out of debt and profitable.
Featured photo credit: StartupStockPhotos via pixabay.com
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