Just as you need to continuously monitor and reduce direct and indirect expenses in your regular business, you will also need to reduce costs in your online business if you want to increase your profits.
- If you plan to purchase products, then do some research first.
If you plan to buy and sell, it’s important for you to research which items move fast and which move slowly.
You can do this by going to sites like eBay and observing the items that are in greatest demand. eBay also makes it possible to check out the top ten fastest-moving items.
Next, determine your profit margin by comparing what you paid for the product with the price advertised on the different websites. If you find that there is a decent profit margin, then go for it.
Even so, don’t order a very large quantity of any item – or you could face losses in case the demand fades.
You can also use your garage as your warehouse if the size of your items is not very large, provided you have the necessary local permits.
- If you do not plan to maintain inventory, then find a good drop-shipper.
If you plan to sell products on the Internet without maintaining inventory, then do proper research and find one or more drop-shippers who stock the products and will ship it to your customers on your behalf.
- Check out the hosting charges.
Find out what your website hosting costs you, whether on eBay or any other website. Look for sites where the traffic is greater and hosting charges are less.
This way, you can save some money while selling more products. If the site is taking a huge commission from you, then you are simply wasting a lot of time and effort – and your host site is eating a chunk of your profits.
- Know your shipping charges.
If you are shipping your products to customers, then find out the rates and services of various shippers so you can save money on shipping costs.
- Build a client database.
Send out regular emails to clients informing them about new offers or promise them loyalty discounts on certain items.
Since you have been in constant touch via email (you have been, haven’t you?), your messages will go directly into their inbox and won’t be treated as junk mail.
This will ensure repeat business at no extra cost.
- Add advertisements on your website.
Provide links to your readers so they can visit other sites from your website.
This will give your readers more choices – and will also increase your revenue as many advertisers use the pay-per-click method of paying businesses who direct traffic to their sites.
- Learn how to design websites and how to maintain them.
Learn to design and manage your own website. You will save a lot of money that you would otherwise be spending on a professional provider.
Use these tips, and watch your savings turn into additional profits for your online business.
