I am looking to start an online shop. I’m interested in shoes and my focus is to bring new brands to SA, and eventually be the country’s sole distributor of those brands. I have secured accounts with two international suppliers, but I have to keep my current job to support what I want to do. I only have two stock items.
My question is: Do I only start once I have enough stock or would you advise I start the online shop and grow it as I go along? I want to start and grow it as I go, but the person who is doing my site is telling me that I can’t start with only two stock items.
First off, let me commend you for being wise enough to stay in your current job, but also being enough of a visionary to pursue what you think will fulfil your dreams. Just from that alone, I think you may have the knack to make it as an entrepreneur.
But to get to your question: Quite simply, you have the right idea, in principle. However, I do think the advice of your website developer – depending on what you’re expecting to happen – should not be ignored entirely.
Let me explain.
There’s absolutely nothing wrong with starting your online shop with the two products you currently have available. Remember that with the major growth of online shopping in South Africa, the fact that you are offering a specialised product range – which I will take for granted you believe there is a market for – means that you will stand out from your competitors. When most people shop online, they go directly to their favourite retail store websites – your competitors.
In this regard, as a seller of apparel your competitors are Woolworths, Mr Price, Spree, Zando and more recently, Superbalist. Your idea to sell a select, limited range of items is a good one, as it differentiates you from them.
Equally so, however, you do need to recognise that launching your store with only two items will mean that revenue will be limited. Now, if you are willing to accept that fact, I’d say go ahead and launch. This, of course, will be turning the conventional wisdom of entrepreneurship – of waiting and preparing until your business venture is as perfect as you see it being – on its head.
However, even with ‘imperfect business’ generating limited revenue, you will be gaining invaluable information about your target market.
With feedback from your early adopters – the customers who buy these two stock items you currently have – you will be able to tailor your store, product line, your venture as a whole – to suit your target market. A tip if launching with only two products is to look at it with a promotional direction – ‘Our two feature products of the month’ thus giving visitors to your site the impression there is more to come. This is the core idea behind the Lean Startup Movement.
But as for your question; If you’re looking to start generating an income immediately, then your web developer is correct; you’d need more products.
In my opinion I would advise you to launch. But the key to this is not to look at this launch as a revenue generating period, but rather a beta-testing period – a period in which you’re gathering feedback and learning what works and what doesn’t. With that information, you’ll be in a far stronger position once your other contracts are lined up. This is a great opportunity for you to test your digital marketing with a small segment of your market and gain insights into visitor flow.