E-commerce Definition. What is Ecommerce? E commerce Explained for 2019

In a nutshell, e-commerce is just the process of buying and selling produce by electronic means such as by mobile applications and the Internet. Ecommerce refers to both online retail as well as electronic transactions. Ecommerce has hugely increased in popularity over the last decades, and in ways, it's replacing traditional brick and mortar stores.

Ecommerce enables you to buy and sell products on a global scale, twenty-four hours a day without incurring the same overheads as you would with running a brick and mortar store. For the best marketing mix and the best conversion rate, an Ecommerce venture should also have a physical presence; this is better known as a click and mortar store.

What does ecommerce mean? E commerce Definition

While most people think of ecommerce as business to consumer (B2C), there are many other types of ecommerce. These include online auction sites, internet banking, online ticketing and reservations, and business to business (B2B) transactions. Recently, the growth of ecommerce has expanded to sales using mobile devices, which is commonly known as ‘m-commerce' and is simply a subset of ecommerce.

Why has ecommerce seen explosive growth over the past decade? As the internet becomes ingrained in our daily lives, acceptance of ecommerce continues to grow, and businesses are taking advantage of this.

In the early 2000’s many people were skeptical about handing over their card details to an online retailer. Whereas, ecommerce transactions are now second nature. SSL certificates, encryption and reliable external payment systems such as Paypal, Worldpay, and Skrill have helped improve people’s confidence in e commerce.

But before that, here are our top rated ecommerce platforms that we think are the best fit for any needs.

Comparison chart

Details
Features Ease of Use Pricing Templates & Design Inventory SEO & Marketing Payments Security Customer Support
  1. Shopify logo

    Free Trial
    From $29
    SEO Friendly
    Offline Store
    App Store
    24/7 Support

    9989899910
  2. Bigcommerce logo

    Free Trial
    From $29.95
    Built-In Blog
    SEO Friendly
    App store

    878878897
  3. Volusion logo

    Free Trial
    From $15
    Social Media Tools
    Mobile Commerce

    986576668
  4. Squarespace Commerce logo

    Free Trial
    From $8
    Mobile Friendly
    Free Custom Domain
    Social integration
    24/7 Support

    375765867
  5. WooCommerce logo

    Free SEO Friendly Analytics Discount CodesDigital Products

    646767765
  6. 3dcart logo

    Free Trial
    Social Integration
    Custom Designs
    Gift Certificates
    App Store

    666755656
  7. WIX logo

    Free Trial
    From $8.08
    simple dashboard
    SEO Friendly

    676456567
  8. Ecwid logo

    Free Trial Social Integration 24/7 support

    765455866
  9. Webflow logo

    Free plan
    From $15
    99.99% uptime

    666846554
  10. Weebly logo

    Free Trial
    Free Plan
    From $5
    Free Domain

    576465456
  11. Square Online Store logo

    Free Plan Mobile Friendly Sell online & In Person

    565545646
  12. Big Cartel logo

    Free Trial
    From $24.99
    SEO Friendly
    Analytics
    Discount Codes
    Digital Products

    377345467

ecommerce

Starting an E commerce business has never been easier. Solutions such as Shopify and WooCommerce allow even the least tech-savvy individuals to set up a store.

Gone are the days where hiring a designer and a web developer to get your ecommerce company off the ground are necessary.

Nowadays design templates and WYSIWYG systems enable people to launch an ecommerce store in a matter of minutes.

As a result, people are reaping all the benefits ecommerce stores have to offer.

Below are seven reasons why ecommerce is such an attractive option for entrepreneurs:

Global Reach – With a physical brick and mortar store you're limited geographically to nearby markets, i.e., if you have a store in New York and want to also sell in New Jersey, you’ll need to open another physical location.

Ecommerce doesn’t have this limitation. Instead, you can sell to anyone, anywhere in the world via your digital ecommerce business.

Always Open – Physical businesses usually have limited hours, but an online ecommerce shop remains “open” 24 hours a day, seven days a week, 365 days a year. This is hugely convenient for the customer and an excellent opportunity for merchants.

Cost Savings – Ecommerce businesses have significantly lower operating costs compared to physical shops. There's no rent, no staff to hire and pay, and very little in the way of fixed operating costs. This makes ecommerce stores extremely competitive on price, which usually increases the market share dramatically.

Automated Inventory Management – It’s far easier to automate inventory management through the use of electronic online tools and third-party vendors. This has saved ecommerce businesses billions of dollars in inventory and operating costs.

Inventory management has also become increasingly sophisticated. You can now manage your stock across multiple channels with great ease. So, you can sell and monitor your stock in your own store as well as marketplaces like eBay, Amazon, Etsy or a physical shop.

Laser Targeted Marketing – Online merchants can collect an amazing amount of consumer data to ensure they target the right people for their products.

This lowers the cost of customer acquisition and allows ecommerce online businesses to remain extremely agile. Imagine being able to target just males between 18-24 years old, living in urban areas. That’s laser focused marketing for you- there's no way you'd get that with just a physical store.

Niche Market Dominance – Because of the lower operating costs, the ability to target your ideal customer, as well as reaching a global audience that an ecommerce website brings, this ensures your companies profitability.

Location Independence – An ecommerce business owner isn't tied to any one location when running their business. As long as you have a laptop and an internet connection you can run your ecommerce business.

Types of ecommerce Merchants

On the whole, there are two types of ecommerce merchants:

1. Those Selling physical products: This is pretty self-explanatory. It's just the buying and selling of physical products via some kind of electronic medium. For example, you could be selling merchendise from any of the following niches: fashion, accessories, homeware, toys, etc.

2. Stores selling digital products (AKA downloadable products): If you've ever purchased an online course, this falls under the category of ‘digital products.' As a general rule, if you have to access the product via an online members area or if you have to download it, it's probably a ‘digital product.'

What Kind of Ecommerce Business Can You Start?

What are the challenges of Ecommerce?

Image credits:

In theory everything about e-commerce sounds impressive, however, like most things, there are a few challenges you'll need to overcome when launching your own e-commerce on your own.

So in the interest of balance, we thought we'd present the potential pitfalls you may encounter during the infancy of your ecommerce journey.

Trust: Trust is a big word in ecommerce and comes in many different forms.

      • Can your potential customers trust you as a company?
      • Can they trust your chosen payment gateway won’t fail them?
      • Can they trust your products are of good quality?

A trusted payment solution such as PayPal can help instill confidence in people visiting your website. Using a review system such as Trustpilot or registering your site as a Google trust store are just a few ways you can conquer these potential barriers.

Technical issues: If you aren’t technologically minded, and let’s be honest- you don’t have to be to start an online store, you may run into the following issues:

      • What happens if your payment solution stops working?
      • Do you have knowledge of HTML, CSS or Javascript to fix coding issues?
      • If you wanted to design a banner or adjust a graphic on your website, do you have any web design experience?

If you can’t fix these issues yourself, you may need to outsource. Fortunately, ecommerce solutions such as Shopify, WooCommerce, and BigCommerce have dedicated services to help you out if these issues arise.

Competitors: As the initial set up costs associated with starting an ecommerce business are so small, this makes it a saturated market. Therefore it’s vitally important you do your research before you launch, and find your niche.

No physical presence: Although this is improving with time, the fact that visitors can't see or feel any of your products can be a downfall.

Here are a few ways to get around this issue:

      • Offer free returns
      • Add high-resolution images
      • Show customers using your products
      • Include videos of your products being used
      • Include a very detailed description of your products
      • Put an FAQ section on each product page

Initial spend: The biggest challenge with ecommerce is getting started and achieving that all-important first sale.

To do that you may need to spend a bit of money to make some. Some cost-effective ways to get you started, include:

      • Running a Google Shopping campaign
      • Using website pop-ups for data collection
      • Utilizing abandoned cart emails
      • Publishing an upsell/upgrade bar on your website
      • Giving products away to influencers for publicity (you can identify these with tools like Buzzsumo)

What are some Examples of E commerce Stores?

Ecommerce websites are popping up all around us. Are all of them successful? No. Most fail. But why?

In addition to all the above reasons, more often than not, the business owner doesn’t put the needs of the user before their business idea.

User Experience is vital for Ecommerce

Providing an excellent user experience is a critical feature of any successful ecommerce store. Without taking care of this one aspect, you'll face an uphill battle when it comes to driving sales.

So, how do you provide an excellent user experience? Primarily, this comes down to your website design.

If you’re looking for inspiration, check out this post on great ecommerce website designs The 50 Top Ecommerce Websites – 2018 Edition.

These examples of good ecommerce website designs should give you an idea of what elements to focus on. They should also provide pointers on how to provide a rich user experience through additional website features and functional themes.

What makes an e commerce store successful?

What secret formula do you use to increas sales?

We teamed up with Ecommerce Design and selected 60 examples of e commerce sites for their flawless design, fabulous customer service, and unique ideas. The majority of these stores deliver an unforgettable experience to their visitors.

Check out our post on the Top 60 Best Online Shops and Key Marketing Tactics to Learn from Each One.

Making a good first impression is vital – how many poorly designed websites did you revisit after landing on them the first time?

Take this example from gatesnfences.com, would you revisit this website? I certainly wouldn’t.

Check out our list above and learn from these examples. Even if it's just a logo concept or an idea for your own manifesto, apply these to your store.

Ecommerce Success Stories

Myprotein

what is ecommerce - myprotein homepage

When Oliver Cookson used his £500 overdraft to establish Myprotein back in 2004, I bet he'd no idea that seven years later he would sell it to the Hut Group for £58 million.

Armed with just his skills in web development and a love of all things fitness and web development, Cookson’s rise is meteoric.

How did Myprotein become a successful ecommerce store?

A lot of Myprotein’s success came via their social media output, in particular, Instagram. With Myprotein you're investing in a lifestyle- not just purchasing a product.

what is ecommerce - myprotein Instagram

When you're starting up, it can seem appealing to start plastering your social media feeds with offers and discounts. However, consumers are very smart to these tactics, and they don’t like companies who overly promote.

In the long term, this aspirational model will pay dividends and turns customers into fans and supporters.

How can you make your e commerce store feel like a club

Myprotein's customers are committed to the brand because the content they publish is aspirational. They feed on this and use certain words in their marketing to make their customers feel as though they're part of an exclusive club.

ecommerce - my protein vip

See the example above where they use terms such as ‘members’ and ‘V.I.P’ this works incredibly well.

Black Milk Clothing

A huge Shopify success story, Black Milk Clothing have built up a reputation that has seen them go from underdogs to becoming a mainstream name in Women’s leggings.

Black Milk is now a multi-million-pound company selling more than 2000 pairs of leggings a day.

What made Black Milk a success in the E commerce World?

Black Milk certainly didn’t go about things conventionally. In fact, the Australian ecommerce company didn’t spend a penny on Adwords, social media, television, radio; you name it.

Black Milk spent all their money on community events. Granted, Black Milk now travels the world, throwing parties and arranging photo shoots- but they started in their own back garden.

Start by using websites like Meet Up to see what events are running locally. Or if you’re feeling particularly brave, create your own!

How to utilize user-generated content to build your ecommerce brand

Black Milk Clothing is outstanding at creating user-generated content.

They assign a specific hashtag to every piece of clothing on their website and encourage customers to use them. When they do, the image is featured on the product page and possibly on their Instagram channel which has over a million followers.

what is ecommerce - instagram

What's so brilliant about this is that it displays all different types of women that customers can relate to more than the usual models you see on clothing websites.

If like Black Milk you're looking to use Shopify, there are tons of amazing Instagram integrations you can use to publish your feed to your website- such as InstaShow and Code Canyon.

Warby Parker

what is ecommerce - warby parker

Warby Parker’s rise to popularity was much more instantaneous than the two companies we've just mentioned.

Within a year of starting in their modest beginnings at the University of Pennsylvania, in 2010, Warby Parker was described as “the Netflix of eyewear.”

How did Warby Parker Master Ecommerce?

So how did this company become one worth $1.2 billion?

Again it may seem a bit far-fetched, but Warby Parker wasn’t overly promotional. They initially focussed on their blog content which they updated daily.

Their blog was a mixture of insights into photography, interviews with models, as well as the odd book recommendation.

Warby found and used oddly celebrated days to promote their products- in a way that was subtle.

When celebrating National Sunscreen Day (yes, really) they wrote an article about it and pushed it onto their channels using relevant hashtags.

what is ecommerce - warby parker - sunscreen day

This ensured every time there was a random celebratory day related to their product, they were always on the ball and involved with the virality of it.

E-commerce Definition. What are the Major Types of Ecommerce?

The examples I’ve used above are what we'd call Business-to-Consumer (B2C). However, there are varying forms of ecommerce that may match your ideas betters.

There are six types of e commerce. Below we've listed them and briefly explained what they all mean.

1. Business-to-Business (B2B)

Quite self-explanatory, B2B ecommerce occurs when a transaction is made between two businesses.

Successful B2B businesses include companies such as HubSpot who offer inbound marketing and sales software and Xero who provides accounting software for small to medium businesses.

2. Business-to-Consumer (B2C)

The success stories above are all B2C ecommerce companies. This is when stores sell products to consumers, i.e., people like you and me.

Online retail (including dropshipping) usually works on a business to consumer model.

3. Consumer-to-Consumer (C2C)

C2C e commerce occurs when consumer sells directly to consumers. This has seen a particular boom over the last ten years.

Sites such as depop, gumtree and shpock have made a massive name for themselves.

eBay is still the market leader in this niche, having established themselves in 1995. They're closely followed by Etsy who was founded ten years later in 2005.

4. Consumer-to-Business (C2B)

Consumer to business models is slightly less common in ecommerce. This materializes when a consumer sells or contributes money to a company.

Companies using crowdsourcing or a Kickstarter campaign to fund their business would fall under the bracket of C2B.

5. Business-to-Administration (B2A)

This type of ecommerce happens when transactions are carried out online between companies and public administration.

This area tends to involve a variety of services such as social security, employment, and legal documentation.

This type of e commerce has seen an increase in recent years with the due to increasing investment in e-government.

6. Consumer-to-Administration (C2A)

Lastly, this type of ecommerce involves all transactions between individual people and public administration.

A few examples of this would be:

      • Education – publishing and circulating information, distance learning
      • Tax – Tax return forms and payments
      • Health – payments to health services, appointments

What is the Best Ecommerce Website Builder?

“An ecommerce website builder? Why do I need one?”

Well, put simply, they're all the rage these days for anyone wanting to launch their own online shop.

However, there are a few questions and potential problems you need to consider before you select the right website builder for you.

First off, you don't want to choose an ecommerce website builder to realize one year later you're paying too much in transaction fees. Another common issue is that entrepreneurs can't handle the design tools because they're made for more experienced developers.

Therefore, dividing your ecommerce website builder shopping experience into two areas: (a) what you want to accomplish, and (b) what your own needs are is usually a good idea:

      • With personal needs, it all comes down to how experienced you are and how quickly you plan on scaling up. A builder with hundreds of templates is great for a beginner, but what if you'd like to get into the custom CSS, and that's not available?
      • The second area to evaluate is what you want to accomplish. This ties into the tools, settings, and features offered through the platform. With that, we want to take a look at the current state of ecommerce, so you get a feel for the kind of functionality you'll require.

We review an extensive range of ecommerce website builders in this article: Ecommerce Website Builder: The Best Tools to Create a Winning Online Shop.

Here's a brief synopsis of four of the most significant tools on the market and which sorts of companies are best suited to them:

Shopify

what is ecommerce - Shopify homepage

Shopify has always been at the forefront of making ecommerce accessible to everyone. Plans start as low as $9, and there are 24 free website themes you can use to get you started with.

Shopify has turned ecommerce on its head and has made the process of a setting up a website incredibly easy for even the biggest technophobe.

This is further backed up by their 24/7 customer support/ You can take advantage of email, phone and live chat support regardless of the pricing plan you're on. You can enjoy their support in the first few months when you’ll probably need it the most!

Is Shopify suitable for me?

If you're looking to start your ecommerce business from scratch today then Shopify is a great choice. Additionally, as your business grows, Shopify can grow to match where you're at by offering better shipping discounts as well as unlimited staff accounts and advanced reporting.

Read a thorough review of Shopify here.

Check out our in-depth guide to Shopify pricing plans.

Try Shopify for free here.

WooCommerce

what is ecommerce - WooCommerce homepage

Whereas every other ecommerce website builder in this list is ‘hosted,’ WooCommerce is ‘self-hosted.’

Hosted means you pay for the solution and web hosting comes as part of the package. Whereas with self-hosting, you'll need to find your own hosting and pay for it.

If you already have WordPress, simply attach the WooCommerce plugin for free, and you're ready to go.

Is WooCommerce suitable for me?

If you're looking to start your own store on a budget, and have a decent knowledge of hosting and web development, then WooCommerce is the option for you!

It's also ideal if you already have a WordPress account and know how to operate that.

Read a thorough review of WooCommerce here.

Magento

what is ecommerce - Magento homepage

There are two versions; one called the ‘open-source solution,' similar to WooCommerce where you need to purchase your own domain and hosting.

Alternatively, there's a hosted solution, but this can be very, very expensive.

Magento is used by some of the biggest companies in the world, and the scalability of it is seemingly endless.

Whereas you could probably recognize a Shopify store just by looking at it, Magento has a massive range of themes to make your website look unique.

Is Magento suitable for me?

If you're starting up, you may consider the free open-source option. The hosted solution isn’t suitable for fledgling companies.

If your business takes off and you need more flexibility with your website, then Magento is ideal.

Read a thorough review of Magento here.

BigCommerce

what is ecommerce - BigCommerce

BigCommerce markets itself as a platform for “growing sales,” pitching themselves as a more high-end version of Shopify.

Their lowest pricing plan stands at an affordable $ 29.95, and their themes and app store are full of great options. The backend is very intuitive making it accessible even for those who aren’t confident using ecommerce website builders.

Similar to Shopify, support is available 24/7 to ensure you're getting those much-needed answers to your questions. These always crop up early on!

Is BigCommerce suitable for me?

If you're ambitious and see your business taking off very quickly, then BigCommerce is a great tool to support that.

It’s very accessible and has a range of backend features for discounts and coupons. Not to mention, it also offers you the chance to sell through Facebook.

Read a full review of BigCommerce.

Try BigCommerce for free here.

Other Top Ecommerce Solutions

If you're trying to find the right ecommerce solution for you, you need to consider all your options. Here are a few programs we recommend.

Volusion

what is ecommerce - Volusion

We love that Volusion offers users a 14-day trial period. So, you don't have to hand over your hard earned cash until you've tried and tested the software for yourself.

Not to mention, they offer tons of features. Some of the more notable ones include:

  • Responsive themes: your store will look fabulous no matter what size screen your customers use
  • Inventory management
  • Payment collection
  • Dozens of compelling apps and integrations to enhance your user experience
  • SEO management,
  • A CRM system,
  • Around the clock support

Just to name a few!

All in all, Volusion offer their users an excellent ecommerce platform to utilize.

Read a full review of Volusion.

Check out our in-depth guide to Volusion pricing plans.

Try Volusion for free here.

Big Cartel

what is ecommerce - Big Cartel

If you want to start selling homemade art online, then Big Cartel is probably the best ecommerce platform for you. Founded back in 2005, they boast well over a decade of experience in this field. Needless to say, they know a thing or two about helping small brands build an online presence.

There are plenty of free themes you can use to customize the look and feel of your ecommerce shop. Alternatively, if you have any experience coding or web designing, you can craft a one-of-a-kind design that brings your vision to life.

Here are a few other features users of Big Cartel can enjoy:

  • Store management
  • Order fulfillment
  • The ability to easily modify your products
  • Tools to help you monitor your progress using site analytics
  • Features enabling you to launch digital marketing campaigns

So, what are you waiting for? Start selling your art today!

Read a full review of Big Cartel.

Try Volusion for free here.

Teachable

what is ecommerce - Teachable

With Teachable, you can create a course for your customers in a way that's incredibly user-friendly. With just a few clicks of a button, you can set up a fabulous virtual classroom, complete with learning management tools, fully functioning payment gateways, a customizable interface, responsive design, and last but certainly not least- handy marketing features.

Alternatively, if you have any experience coding, you can use Teachable's Power Editor to modify virtually any aspect of your digital course.

Plus, it's super easy for students to do all the following:

  • Sign up to your course
  • View your curriculums
  • Purchase your courses
How awesome is that?!

Is Teachable suitable for me?

If you want an ecommerce platform that enables you to provide customers with a top-notch learning experience, then teachable is the solution for you.

It's fabulous if you don't have many technical skills, they offer users out-of-the-box websites which hardly requires any kind of configuration.

Plus, it's great for entrepreneurs on a tight budget. All you need is your name and email address to get started- you don't have to pay a dime to create your course!

Read our full review of Teachable.

Try Teachable here.

Udemy

what is ecommerce - Udemy

Just like Teachable, Udemy is another ecommerce platform enabling entrepreneurs to launch online courses. All you have to do is plan your course, record your video lessons, then grow your community.

One of the best things is that you can create classes in numerous languages. This works wonders for extending your reach and growing your customer base.

Plus, Udemy also provides plenty of free courses to teach you how to make the most of their software.

Is Udemy suitable for me?

If you're looking for an ecommerce program to launch an online course, then Udemy could be the platform for you. If customer service is essential to you, you'll be pleased to hear users are provided with 24/7 customer service.

So, no matter what time of the day or night it is, you'll get your questions answered. You can also use their Teach Hub,- this is best described as a resource center and is terrific for helping you get to grips with their software. Plus, there's also a Facebook support group you can make use of. So, when it comes to getting the help you need to get up and running, it doesn't get much better than Udemy!

Read our full review of Udemy.

Try Udemy here.

Easy Digital Downloads (EDD)

what is ecommerce - EDD

If you want to sell digital products using WordPress, then Easy Digital Downloads is the perfect ecommerce platform for you. It doesn't matter whether you're selling an eBook, an app, or a digital course- you can use EDD to build your business.

They offer an impressive array of features, including:

  • A plethora of popular integrations
  • The option of creating discount codes with great ease
  • A full shopping cart
  • Unlimited file downloads
  • File access control
  • Customers can create their own accounts
  • You can track customer activity
  • You can utilize comprehensive data reporting tools

Is EDD suitable for me?

In short, if you're selling digital products rather than physical products, you should consider using EDD. However, you'll need a bigger budget as EDD's cheapest pricing package is $99.

Read our full review of Easy Digital Downloads (EDD).

Try EDD for free here.

Sellfy

what is ecommerce - Sellfy

Sellfy, just like many other ecommerce solutions in this guide, offers tons of fabulous features. So, if you're looking for any of the following, consider using this program:

  • A customizable storefront
  • Built-in email marketing
  • Facilities for offering customers coupons and upsells
  • Advanced analytics
  • Instant payouts
  • Secure Checkout

These are just a few of the many features Sellfy have to offer!

Is Sellfy suitable for me?

If you want to get your ecommerce store up and running in a matter of minutes, then Sellfy's ideal. They claim that their users can build a fully functioning store within as little as five minutes! So, in no time at all, you can market your products via your website and social media profiles, and start bringing in those all-important sales!

Read our full review of Sellfy.

Try Sellfy for free here.

Ecommerce Marketplaces

Just selling items on your online store, limits the potential of how much money you'll make.

With inventory management software it’s never been easier to manage your stock across multiple channels. Which means you can concentrate on what matters most, selling more products!

Here’s a short list of marketplaces, you should consider using alongside your online store.

eBay – People have the assumption that eBay is purely for C2C businesses, but that’s not the case.

There's a whole host of B2B and B2C transactions happening on this site. If a product isn’t selling well on your website, try putting it on eBay as an auction to recuperate some money back.

Amazon – There isn’t an awful lot that Amazon doesn’t sell now, so even if your idea for a product hasn’t been done before there's a place for it on Amazon!

With around $90,000 being spent on Amazon every minute around the world it’s imperative you list your products here.

Etsy – Etsy in an online marketplace that's ideal for anything handmade. It specializes in the vintage and unique!

Etsy has a fantastic community vibe to it and is excellent for building a good reputation as a seller.

Alibaba – Alibaba is a marketplace for manufacturers, suppliers, exporters, importers, buyers, wholesalers, products and trade leads

A considerable advantage is that you have access to countless suppliers who sell pretty much any product you can think of it. If you don’t have an original idea and just want to start of selling, then check out Alibaba.

Where Can I Source Products for My Ecommerce Business?

There are tons of places to source top-quality products to sell on your ecommerce store. However, these tend to fall into one of three categories: Manufacturers, drop shippers, and wholesalers.

For more information on all of these, check out our other articles:

What are the Best Dropshippers (Drop Shipping Companies) for Ecommerce [February 2019]

Dropshipping Definition: The Best Way to Setup a Dropshipping Business Quickly

How to Find the Best Wholesale Suppliers for Your Online Store

1. Manufacturers

A manufacturer is a company who creates its own merchandise and sells it to any of the following:

  • Individual consumers
  • Wholesalers
  • Distributors
  • Retailers

Traditionally, manufacturers create and assemble products on a larger scale so they're ready for distribution. On the whole, it doesn't matter whether you purchase goods via an ecommerce store or in a conventional brick and mortar store, the goods will have labels displaying where the merchandise was created (i.e., where the manufacturer is based).

Types of Manufacturer

There are three types of manufacturers:

1. Made to Stock: This kind of manufacturer produces goods to be displayed in showrooms or shelves. As such, the manufacturer can usually predict the demand and therefore builds its products in advance. That way they're far less likely to run at a loss.

2. Made to Order: This branch of manufacturing does precisely what it says on the tin- they produce orders as they come in. Just like the Made-to-Stock business model, the inventory is pretty easy to handle. There shouldn't be too much loss because they only create products when a specific order comes through. However, as such, customers have to wait longer for their stuff to be delivered.

3. Made to Assemble: Last but not least, this is when a factory only produces the essential parts needed for the user to assemble the finished product themselves- a bit like Ikea! This is best for companies who want to fulfill customer orders quickly. However, it's a little riskier than the others because you can end up with loads of unneeded parts.

2. Dropshipping

In theory, drop shipping sounds simple.

All you have to do is launch your own ecommerce shop and then reach out to suppliers. You then take orders from customers to which you'll pass onto the said supplier. They then ship your customer's orders directly to them.

This is a fantastic business model for entrepreneurs who don't have space or the budget to stock masses of inventory. Plus, it minimizes the overall risk. With drop shipping, you don't have to spend any money before the customer pays you- which is ideal for business owners running on a tight budget!

3. Wholesalers

Out of using the services of wholesalers, drop shipping, and manufacturers- wholesalers are probably the hardest to handle. The system isn't very well structured. It's just an extensive list of random suppliers, and in some cases, they're dotted across the globe.

This means you need to do some research and find out how these wholesalers are structured.

Some of the better ones include AliExpress or Alibaba. These resources enable you to research which products are the most popular, so you're more likely to find goods your customers actually want to buy.

You can also do all the following with these websites:

  • Filter products,
  • Source product photos,
  • Find detailed information about the supplier,

As you go through wholesaler directories and conduct your research, ensure all potential suppliers show a good track record of delivering their goods on time, offer a reliable point of contact, and produce top-notch products.

What Kind Of Budget Do I Need To Start an Ecommerce Business?

You can literally start from $0 and start making money using ecommerce.

Don't believe us? Here are a couple of articles that show you how:

How to Sell Online – The Ultimate Guide to Go From 0 to $$$

What is Ecommerce?

If you don't have time to read these articles, here are a few highlights to help you kickstart your venture:

  • Choose the right ecommerce platform for your business
  • Use responsive design
  • Ensure your online presence always makes a killer first impression
  • Upload top-quality product photos
  • Ensure your ecommerce site's easy to navigate
  • Create a USP (Unique Selling Proposition)
  • Start a blog on your ecommerce store
  • Create a compelling ‘About Us' page
  • Optimize all your content for SEO
  • Laser target your ideal audience
  • Utilize live chat to improve the quality of your customer service
  • Use coupon codes
  • Ensure your shopping cart experience is user-friendly
  • Have and execute an effective shipping strategy
  • Get feedback from your customers and make necessary improvements
  • Ensure your site's secure
  • Use social media to boost your brand and drive traffic to your ecommerce store.
  • If you're not already, have a referral program in place.

What Kind of Ecommerce Business Can I Start?

If you're interested in kickstarting your own ecommerce store, but don't know where to begin, we thoroughly recommend reading the below articles. They're sure to fuel you with inspiration:

Once you've read through these guides, you should have a better idea of the kind of ecommerce store you want to launch yourself.

How do I start an Ecommerce business?

When you start an ecommerce site, you realize that there are loads of items that need to be checked, cross-checked and tested to ensure that your customers have a good experience. That’s why we put together an expansive checklist for new ecommerce sites.

Often, the largest obstacle that business owners face is being unfamiliar with the process, So we put together a post on ten easy steps to learn how to open an online store, whether you already sell products in a brick-and-mortar location or you're starting an online business from scratch.

Are you sitting around with a sweet new product idea and you want to start selling it online? Have you been trading in a brick-and-mortar shop and now you want to bring your business online? The solution is building an online store, so I want to show you how to start an online shop in just 15 minutes.

Become an ecommerce expert

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