Make Money By Setting Up Online Retail Stores

A lot of this site and many other work at home sites focus on very basic internet marketing techniques revolving around Ebay, Adwords, Adsense, etc.. There is another method that is not often discusses which I will share with you today. Making money by setting up online retail stores.

When I started making money online back in 1996, I didn’t know a thing about “internet marketing”. What I did know is that I was tired of getting up every day, fighting traffic both ways in all kinds of inclement weather, sitting inside my cubicle and waiting for 10:00, 12:00, 2:00 and 5:00 so I could get up and go to the bathroom if I needed to. All of this while my efforts were putting money into someone else’s pocket.

I had been seeing the infomercials from SMC every night with ol’ Tom Bosley telling me how much money I could be making working for myself, all I had to do was call, and call I did.

After receiving my initial package, the excitement started wearing off when I began to realize that I had to actually go out and sell this stuff. Wow, I hadn’t really given that part of the process a lot of thought before jumping right into the deep end of the pool. The idea of going door to door selling alabastrite figurines didn’t appeal to me as much as it seemed to when they psychologically honed in on my emotional triggers at 2am through their infomercial.

My wife suggested that I “sell them on the Internet”. My response was “what’s the Internet?”. We still think back to how it all began and enjoy a good chuckle from time to time. To think, I would never be where I am today if it weren’t for her remarkable insight into the bright and mysterious future that was evolving. And don’t think she doesn’t remind me of that little fact either. lol

Armed with a vague idea of what “the Internet” was, I purchased a computer and after a little research, headed off to the bookstore for a book on html. Later, I would discover the WYSIWYG (what you see is what you get) html editors like FrontPage, DreamWeaver and for those on limited budgets NVU (free).

I then proceeded to take SMC’s catalogues, scan the product images and build websites with them, after many, many, did I say many, long days and nights trying to configure shopping carts which at that point in time were made for technically savvy people and were not very friendly with their user interfacing. You had to open these scripts up in notepad and go through the code. Fortunately, things have gotten much better and setting up a shopping cart is amazingly simple.

Which brings us to the actual subject of this article, let’s talk for just a second about shopping carts. There are many to choose from, some which cost you a little money to use and some which are entirely free.

Something To Sell

The first thing you’ll need to decide is whether you want to sell products you create yourself, whether you want to order in quantities and ship yourself or whether you would prefer to utilize the services of a dropshipper. We’ll discuss all three options for a moment.

Option #1: If you have a passion for creating something, it could be gift baskets, jewelry, birdhouses, PVC patio furniture or just about anything imaginable, you might want to consider this option. Since you are creating the product yourself, this generally gives you more freedom over your pricing and greatly reduces the competition. The downside is the time limitations. You can only create so many of your products yourself since you probably don’t have a manufacturing plant with a line of assembly workers standing by to create your products by the hundreds.

You would have to decide whether the amount of time you had to put into it would be profitable.

How much do these products cost to make?
How much time does it take to create each one?
How much can I sell them for?

Creating a product that takes one hour to create and cost $2.00 in material with a retail price of $7 would leave you making about $5/hr and that’s before any taxes or other operating expenses. That item is probably not going to be worth your time unless you are just looking to make a little extra money on the side doing something you love.

On the other hand, if you were building PVC furniture and you could build an outdoors 3-Seat Sofa for around $75 which you could then sell for $350 online, even if it took you all day to build, it would probably be worth it. I use PVC patio furniture as an example because that’s something I enjoy, other big ticket items include backyard forts, porch swings and picnic tables.

One of the great things about selling big ticket items online is that you can easily afford to pay others to help you build these items and still make a nice profit should your online retail business take off.

There are plenty of big ticket items being sold online and a quick trip around the Internet can help you locate many other highly profitable items you could create yourself and sell online.

Before we move on, let me point out that what you sell online doesn’t necessarily have to be something you’ve created yourself from scratch. Maybe you have a skill that could be turned into cash. Refurbishing old bicycles or computers are two quick examples of how you could turn a skill into something tangible to sell online. If you’ve ever watched the Home & Garden channel you may have seen some of their shows like “From Trash to Treasure”. Most cities have trash days where people place items out on the curb. Once it’s on the curb to be hauled away, it is free for the taking. Being selective, you could easily come up with a bottomless supply of “projects” which could be repaired, refurbished or if you are creative, altered into something artfully unique which could be resold.

Option #2: If you have the money to spend, you may find that buying wholesale in quantities suits you. This is a little trickier than Options #1 or #2 because you are actually spending a significant amount of money to get going so failure is definitely not an option here.

First, let me say that all things are not as they appear. By that, I mean, just because you come across a website with the words “wholesale”, doesn’t make it so. Anybody can use that term when, in fact, they may just be a middleman themselves trying to cut out a little piece of your pie.

As a rule of thumb, you won’t find “real” wholesale buying opportunities by visiting websites and looking for a “wholesale” link. You will need to go directly to the source to buy wholesale from most companies. Also, most businesses that are genuinely selling wholesale will require you to have a business tax id (ein) which you can easily get online through the IRS here and a resellers license (tax id). You can get more information on setting up your business through your states Tax Commission Office. Depending on the items you will be selling, other permits may be required by your state. Be sure and contact them to see that you are in compliance with your states laws.

You can visit ThomasNet for a complete directory of manufacturers and distributors. Once you’ve decided what product(s) you’d like to sell, contact these companies directly to seek information on purchasing wholesale, alternatively, you can look to Alibaba which is a huge marketplace for business to business wholesale opportunities. If you use Alibaba, be sure to read their section on Buying Safely and take action to ensure your transaction is a safe and successful one.

Other Wholesale Sources

Wholesale Network For Online Business. The #1 Selling Wholesale Membership In The United States. You’re minutes away from two million products you can buy wholesale and resell at a profit.

Wholesale Designer Handbag Directory. The Most Up-To-Date, Comprehensive Directory Of Legitimate Authentic Designer Handbag Suppliers.

The Gift Basket Connectory Program, Forum And Marketplace. The Gift Basket Connectory Is The Ultimate Resource For The Gift Basket Industry. How-to Videos, Guides, Templates, Industry Forum With Over 58,000 Searchable Articles Written By Over 3500 Gift Basket Industry Professionals, And Wholesale Marketplace.

Own A Jewelry Business For Less Than $50! Over 250 Jewelry Wholesalers, Dropshippers, Liquidators & Manufacturers Plus Find Out Where To Buy New Diamond Jewelry 90-95% Below Retail Cost.

Get Your Federal Firearms License. Kit To Help You Get Your Federal Firearms License And Buy Guns Wholesale.

The downsides to this option are, firstly, the most obvious, the large upfront costs of buying in bulk and secondly, as in option #1, you will be responsible for shipping the products to your customers. If you are operating on a grand scale, this is easily overcame by hiring people to assist with the packaging & shipping.

The upside to this option is that you should be able to gain a lions share of the market by buying directly from the source allowing you room to price lower than your competition since most will probably be affiliate marketing for other sellers, buying “wholesale” through Ebay, “clearance” sites or other middleman sites which means they are paying more for the product than you are.

Not necessarily considered “wholesale”, other avenues for purchasing products at a reduced cost can include Government Auctions, Storage Auctions, closeout liquidations.

Storage Auction Secrets. Have you ever passed a storage unit facility while driving down the road? What you may not know is that there is a fortune inside those storage units just waiting to be uncovered!

Gov-Auctions.org. America’s most trusted & largest resource for Government & Police, live & online car auctions of Gov’t pre-owned and seized cars, trucks, & SUV’s.

Option #3: If you think you may like to operate one or even hundreds of online retail sites where you drive traffic to your websites, accept the customers payments and have another company handle the shipping, then utilizing companies drop shipping services may be for you.

This is the method I primarily use. Although you are not receiving true “wholesale” pricing, it is convenient to be able to sell a wide variety of products from many different companies.

You may be wondering what is the difference between affiliate marketing and drop shipping?

With affiliate marketing, you just use a link to the companies website which tracks their purchase in which you receive a commission and that pretty much ends the transaction, the customer may get a cookie set to track purchases for an additional 30-90 days, if they don’t clean out their browsers cookies periodically which many people do. There’s also a problem with some virus protection software blocking cookies altogether All in all, cookies are a very unreliable way of tracking sales and you will invariably end up missing sales because of that tracking method.

With drop shipping, you actually build an entire website with all the products for sale on your site. The customer can shop on your site, adding items into their shopping cart and not relying on cookies. When they are finished, they checkout and pay you, you in turn pay the company the drop shipping price and then mail to your customer in your name.

The reason I like to do this is so that I can build a long term, sustainable cash flow by giving customers a reason to come back and purchase from my site, even if they stumble across the actual company whose products I am selling.

The way I do this usually is to offer free shipping or different discounts. Anything to make the end cost of the purchase less than if they bypassed me and purchased directly from the company.

One example of this is my online retail store, The Herbal Remedies Store. The products for sale on that site are drop shipped by Native Remedies. One product I sell, A+ TestCalmer, retails on my site and the suppliers site for $39.95 (I match them on price but beat them on shipping), my drop ship cost for that product is $23.73 which would be a profit of $16.22. The supplier charges $5.99 for shipping on the 1st product and then $1.99 for each additional item. I offer free shipping, so deduct the $5.99 which I pay for the shipping and this leaves a profit of $10.23 minus the nominal PayPal processing fee of approx $1.86 leaving a grand total of $8.37 as actual profit. Since most customers purchase multiple items, my profits go up considerably on additional items they purchase. If they purchased a second item at $39.95, minus the $1.99 shipping fee for the 2nd item and the PayPal fee of $1.86, this would give me a profit of $20.74 for the two items combined.

Now, lets see what would have happened if I would have sent the customer through an affiliate link to this suppliers very generous 25% commission affiliate program. (most affiliate programs pay out 2%-10%)

Two items at $39.95 = $79.90 x 25% commission = $19.98

Not only did I come out slightly ahead, but by giving the free shipping, I’ve given that customer a reason to come back for their future purchases and I’ve ensured my profit by processing the payment myself and not risking losing it somewhere in the cookie tracking system. This supplier claims to offer lifetime commissions but I never trust that 100% as I’ve seen “lifetime commissions” end when a customers credit card expires or in the event they are tracked by cookies, it’s even less secure. Plus I have now built up a customer base I can refer to any new retail stores I create, offer related or complimentary products from other companies on the same site, etc..

As mentioned above, most affiliate programs are not anywhere near this generous and the benefits would be even greater.

For detailed information on drop shipping and list of wholesale drop shippers (not middlemen proclaiming to be wholesalers), visit The Home Drop Ship Guide. The Home Drop Ship Guide Is An Easy, step-by-step Starter Guide, that Shows You How To Start Your Own Home Drop Ship Business!! Plus You Get Three Months Of Personal Tutoring From expert Lisa Page For Free!

Now that we’ve essentially covered the basic ways of getting product to build our retail stores, and assuming you’ve decided which method you want to go with, you’re now ready to build your store so let’s take a look at the next step in the process.

The next steps involve setting up hosting, paypal payment processing, shopping carts, etc., if you are not technically inclined, you may choose to skip this step and go with a turnkey system that is already built and ready to start taking orders, includes access To 500 True Drop Shippers! Free Turnkey Ecommerce Website Stocked With 200,000 DropShip Products. Free Hosting And Free Domain Name.

If you’re still with me, it seems like you are ready to get hands on and start building your online retail store, so let’s do it!

The first thing you’ll need is a domain name for your store and a web hosting account. Choosing a domain name is extremely important so take your time with this. You want something that is easy for your customers to remember, once you’ve come up with something you like, register it at GoDaddy.com. At the very top of their site, you will see a search box, you can use that to see if the domain name you want is available. GoDaddy offers a multitude of services, you don’t need them. You just want to register your domain name and that’s it.

If you are unable to locate a good domain name, there are marketplaces online for people wanting to sell domains, such as Sitepoint.com. Keep in mind that these people are obviously trying to profit from the acquisition and sale of decent domain names which is an acceptable practice but keep in mind that everything is negotiable. If there is a domain that fits and you really think it will make a difference, offer a reasonable price and negotiate until you’ve reached a satisfactory price.

For the most part, I feel that is unnecessary and you should be able to come up with something still unavailable. It really doesn’t even have to say exactly what the product niche is in the domain name, just look at yahoo, google, bamzoo and all of the others you can think of that their name doesn’t really tell you what the product is. They key thing being something short and easy to remember.

Once you’ve registered your domain name, you will need hosting. I use and recommend HostGator.com for this. You’ll see three plans listed across the top, Hosting, Reseller, Dedicated. You want the Hosting, once you’ve clicked through, you’ll see three more options, Hatchling, Baby and Swamp, I suggest getting the Baby, it’s only $7.95/mo and will give you everything you need to get going. If you ever start to outgrow it, you can easily upgrade.

With the Baby Croc plan, you can set up as many domains on it as you want, this means you can run all your online retail stores on this one account.

Next, you’ll want to install a shopping cart. I highly recommend Zen-Cart, it is a highly sophisticated shopping cart system which has features such as, easy installation, multiple customer modes, unlimited category depth, multiple sales and discounts, multiple display modes, and… XHTML template system, unlimited extra pages, multiple ad banner controller, multiple shipping options, multiple payment options, plus… newsletter manager, discount coupons, gift certificates, featured products, quantity discounts… and more! Even better, it is 100% FREE with an active support forum.

If you are using HostGator for your web hosting, you can log into your control panel area and look for the smiley face icon labeled “Fantastico De Luxe”, click that and from there, Zen-Cart is an automatic install listed in the left column.

Zen-Cart is an extreme shopping cart system and can be a little overwhelming if you’ve never used it before. I got through it my first time and I’m sure you can too, though if you prefer not to worry about it, I’m sure you can find someone who will install it for you at either RentACoder or ScriptLance for a modest fee.

Whether you decide to install Zen-Cart yourself or pay to have it installed, a worthwhile investment so that you can learn the shopping cart system and easily crank out your online store empire is the book, e-Start Your Web Store with Zen Cart. Entirely up to you, but if you’re serious about building a profitable online retail store or a network of them, a thourough understanding of your basic tools is invaluable.

One other cart I’d like to mention quickly is wp-ecommerce. Wp-ecommerce shopping cart is actually a plugin for wordpress (blogging platform). It is a very plain shopping cart which interfaces with PayPal and a few other processors. I originally tried this shopping cart because I wanted to build my online retail stores on top of Wordpress for the benefits of it’s inherit social networking & traffic generating qualities. Because of wp-ecommerces limitations, I would suggest only using it for any retails stores with very few products because while it is very limited compared to Zen-Cart, it is also very light and simple to set up compared to Zen-Cart so you have to weigh the benefits vs the complexity in deciding.

Myself, I’ve decided to stick with Zen-Cart and hope to get my online retail stores running on wp-ecommerce switched over to Zen-Cart and just run a blog side by side instead of trying to build the store into the wordpress blog. I’m not knocking the wp-ecommerce shopping cart plugin at all, the creator seems very nice, they have a helpful support forum and they offer this plugin for free. Someday, I think it will be a fantastic shopping cart system and already is if you only sell a few items and didn’t need the extensive features Zen-Cart offers.

Generally, you will have a selection of payment processors to choose from when configuring your shopping cart system, I only use PayPal so will only be able to share that information with you. If you don’t already have an account set up, be sure and set up a PayPal Business or Premier account now. It’s up to you which you choose, both give you access to Paypal‚Äôs premium services, including the ability to accept credit card payments for customers that do not have a PayPal account.

At this point you should be well on your way to launching your first online retail store. The one remaining ingredient which is key to your success, is traffic, traffic, traffic, and by traffic I mean people who are wanting to buy what you are selling.

Getting The Word Out

1. Issue a press release
2. Social network your website
3. Write product related articles
4. Place free classified ads online
5. Leverage the Ebay Marketplace
6. Utilize Ebays new classified ads system

Most of the marketing involved in bringing buying customers to your online store are free, very time consuming doing everything by hand, but free. For much faster results, automate some or all of the marketing grunt work and focus your attention on creating your product or more online retail stores.

Marketing Resources & Tools

Instant Article Wizard. Create Top-quality Articles On Any Subject In 15 Minutes Or Less (even If You Dont Know Anything About The Topic)!

Sky High Auctions For eBay. Learn From 15 Ebay PowerSellers How They Raked In Over $11,726,200 Last Year Alone And How You Can Explode Your Business Following Their Every Move Using Our Step By Step Course AND for those of you who already own an online business, you’ll discover how to use the power of eBay to rake in piles of hot leads to your websites!

Auction Classified Cash. How To Create Perfect eBay(R) Classified Ads That Puts More Cash In Your Pocket.

Automated Classified Ad Submission Software. Post free classified ads for your products or services on thousands of free classified sites, within the reach of millions of potential customers, using 95% less time and effort.

Social Networking Software. Get an Unlimited Supply Of High PR Backlinks And Laser Targeted Traffic From Major Bookmarking Sites… All Done In Minutes On Autopilot!

Press Equalizer Software. Flood Your Site With Targeted Traffic, Achieve Top Rankings And Gain Dozens Or More Backlinks Using Easy To Write Press Releases!

I would suggest using the mostly free or inexpensive routes for marketing when first starting out. This helps builds backlinks to your store and can help increase your search engine placement. Once you’ve gotten a little traffic, you see that your products are selling well and the profit is there, you may consider different forms of paid advertising like pay per click marketing with Google Adwords or placing banners on websites with a target audience that would be interested in your product, like a banner to your pet supplies store on a pet lovers community forum.

Lastly, do you have enough profit left to harness the power of an army of affiliates selling these products for you? If so, you may want to look into setting up your own affiliate program. iDevAffiliate is a fantastic affiliate management system packed with thousands of features, functions and configuration combinations including simple integration with Zen-Cart. Click here to visit their website and learn more

Good luck and I hope you become very successful!

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