Are you considering taking the leap into entrepreneurship?
In today’s digital age, starting an online store has emerged as an increasingly attractive opportunity for aspiring business owners.
From low overhead costs to global reach, ecommerce offers a world of potential for those willing to embrace the online marketplace.
In this article, we’ll explore ten compelling reasons why you should consider starting an online store today.
10 Reasons to Start an Online Store
- Low startup and overhead costs compared to a physical store
- Ability to reach a global customer base
- Flexibility to work from anywhere with an internet connection
- Scalability to grow the business over time
- Access to valuable customer data and analytics
- Ability to operate 24/7 without being limited by business hours
- More product selection without physical inventory constraints
- Opportunities to build a brand and develop a passionate customer base
- Potential for passive income streams
- Future growth potential as ecommerce continues expanding
01. Low startup and overhead costs compared to a physical store
One of the most significant advantages of an online store is the relatively low startup and overhead costs compared to a traditional brick-and-mortar business.
With an ecommerce platform, you can launch your online store for a fraction of the cost of renting a physical retail space, hiring staff, and managing inventory.
In fact, the US Chamber puts the cost of starting a bricks-and-mortar business at $2,000 to $100,000 depending on the vertical. Now this is a wide range, but there are so many factors at play. Suffice to say, it’s potentially expensive.
Let’s contrast this with starting an online business. I cover some of the costs in our Shopify Review. Conservatively you can get up and running for $29 /mo. On top of that you’ll want a business license, call it $100. If you buy a Shopify template, the most expensive ones run you about $380. If you dropship it won’t cost you anything to hold inventory. If you choose to hold inventory or deploy a strategy like Fulfilled by Amazon (FBA), it will cost you more.
If you keep it simple to start, for less than $1,000, you can start a business.
There’s another benefit too – reduced risk. You don’t need to worry about things like multi-year leases on a storefront.
02. Ability to reach a global customer base
With an online store, your potential customer base is virtually unlimited. You’re no longer confined to a specific geographic area; instead, you can market and sell your products to customers worldwide.
This global reach opens up a vast pool of potential customers, increasing your chances of success and growth.
According to Statista, global ecommerce sales are projected to surpass 8 trillion dollars by 2027, highlighting the massive opportunity for online businesses (for reference, 2023 was $5.7 trillion).
03. Flexibility to work from anywhere with an internet connection
One of the most appealing aspects of running an online store is the flexibility and location independence it offers.
As an ecommerce entrepreneur, you can operate your business from anywhere with an internet connection, allowing you to achieve a better work-life balance and even explore a digital nomad lifestyle.
This flexibility can be particularly attractive for those seeking to escape the 9-to-5 grind or juggling family responsibilities.
04. Scalability to grow the business over time
Unlike traditional brick-and-mortar stores, which are limited by physical space and geographic constraints, online stores have the potential for virtually unlimited growth and scalability.
As your business grows, you can easily expand your product offerings, reach new markets, and increase your operational capacity without the constraints of a physical location.
According to Shopify, the coronavirus pandemic along with mobile technology has significantly accelerated the transition from in-person to online shopping by as many as five years.
05. Access to valuable customer data and analytics
In the world of ecommerce, data is king.
Online stores have access to a wealth of customer data and analytics that can provide valuable insights into customer behavior, preferences, and purchasing patterns.
This data can be leveraged to improve marketing strategies, optimize product offerings, and enhance the overall customer experience.
According to a study by McKinsey, companies that use customer analytics effectively can outperform competitors by 186% in sales growth and more than 126% in profit.
06. Ability to operate 24/7 without being limited by business hours
One of the significant advantages of an online store is the ability to operate 24 hours a day, 7 days a week.
Unlike physical stores that are limited by business hours, your online store is always open and accessible to customers around the globe.
This convenience factor can be a significant selling point, as consumers increasingly demand the ability to shop at their convenience.
According to Statista, 43% of Americans prefer to shop online. This is significant. Do not ignore this.
07. More product selection without physical inventory constraints
In a physical store, product selection is limited by available shelf space and inventory constraints.
However, with an online store, you have the ability to offer a vast array of products without the same physical limitations. You can – but don’t NEED – to stock inventory.
This not only allows you to cater to a wider range of customer preferences but also opens up opportunities to explore niche markets and offer unique or hard-to-find products.
08. Opportunities to build a brand and develop a passionate customer base
Ecommerce provides a powerful platform for building a strong brand identity and cultivating a loyal customer base.
Through effective branding, engaging content, and exceptional customer service, you can create a lasting impression and foster a sense of connection with your customers.
In fact, strong brands can command a 13% price premium. Massive pricing power can come to those with strong brand identity.
09. Potential for passive income streams
While running an online store requires ongoing effort and dedication, eCommerce also offers the potential for passive income streams.
Once you’ve established a successful online store with a steady flow of sales, you can explore opportunities to automate certain processes, outsource tasks, or even diversify into complementary product lines or affiliate marketing.
This passive income potential can provide financial freedom and flexibility, allowing you to focus on other pursuits or simply enjoy the rewards of your hard work.
10. Future growth potential as ecommerce continues expanding
As the eCommerce industry continues to grow and evolve, starting an online store today positions you at the forefront of this exciting and rapidly expanding sector.
Right now, it’s easier than ever to get started with the technology, platforms and tools that are available.
The trends in eCommerce are directionally consistent and growing, you shouldn’t ignore it as it continues to grow year over year, with no signs of slowing down.