E-commerce (shopping online) is more booming in India. Broadband internet and an explosive growth of mobile phones are fuelling this growth further. Companies like Flipkart have already crossed billion dollar valuation. If you have a product to sell, this is the best time to start selling it online in a low budget. In an increasingly digital life it’s very rare for those with a physical product, to not take advantage of the many channels there are to sell online in a low budget. Selling a product online allows you to reach a wider audience and new customer pockets.
Firstly, there is a number of places to sell your product. When choosing a physical shop, your first thought would be to find the location best for attracting potential customers, The same is true for online.
Steps for selling the Products Online in Low Budget:
1. Calculate the costs involved in selling online
Selling online in India involves various costs. It’s very important for us to first find out if we can make good profits after considering all those costs. Let’s look at some of the important costs:
- Shipping Cost – Visit nearest courier or Shipping Company and find out how much it would cost to ship your product in various parts of India. Make a list of states and shipping fee. Normally this cost will be between 5% to 15% of the product cost depending on the size and weight of the product.
- Packaging Cost – Depending on the type of product you are planning to sell, you will need to consider the packaging cost. Check the different packing material and calculate how much you will need for one product. Calculate the total cost per product accordingly. Normally this cost will be between 0.5% to 2% of the product cost.
- Payment Gateway Cost – If you planning to setup your own store, you will need a payment gateway. These normally charge us between 1.5% to 5% of the total transaction. There could be one-time setup fee and recurring annual maintenance fees.
- Storage Cost – Depending on the product, you might need to rent house/shop or some storage space for your products. Find out this cost as well.
- Marketing Cost – Like any other business, you will have to tell the world that you have started the business. Surely, there are free ways to promote your business but at some point of time, you will have to invest in paid marketing channels. Google’s Ad Words is a good platform to start with online ads and it also offers tools to calculate the costs.
2. Find out if it’s affordable to you to sell online
A fair idea of different costs involved in selling online, you can do the quick calculation to find out the profit for your business. Here is a simple formula for calculating profit:
Profit= Selling price – (Source Cost + Packing & Shipping + Transaction Fees + Marketing Cost + Variable Costs)
3. Be Discoverable in Online
The customers are more likely to search for your business before they make any purchase. If they can’t find product reviews or any other information about your business, they might drop off. So, it’s important to have the online presence in the form of the company website, social media account or any other channel.