Is this a viable business?

[Jason_Lee]

I know alot of shop owners in my local town who own clothing shops. 3 out of the 4 are looking to get online. The cost of a website are high. There is the degign, advertising, time to list your products etc.

I already have a designer clothing business online and have advertised my site very well and will continue to do so.

Would it work, offering my website to them. I would go to their premises and list all of their stock on my website. I will work with them very closely to get their stock selling on my website. I will charge a fee for this service. They can concentrate on running their business whilst making money from me also selling their stock on my website. I will do this for a number of shops and make my money that way.

Does this sound like a viable business idea?

Please any thoughts and advice would be of great benifit.

 

[ITF247]

sounds like a good idea, just a way of brokering

 

[Media Jems]

hi there

In principle this sounds like an excellent idea - i'd love to be able to shop around in my fav local shops without having to leave the house or when I fancy some e-shopping in the middle of the night when my hubby is asleep!

The only thing I am concerned about is whether the shop owners would be happy with the procurement implications - i.e sending individual items out to people who buy online..it would certainly cause a problem if they are already rushed off their feet as they wont really have the time to do this aswell.

My advice would be to get your plan and costing model together and approach a few people and see what the response is - it may even be worth piloting the scheme with a couple of the larger shops and see what happens?

Of course you'll need to generate as much awareness of this as possible in the local media to ensure that people actually know about the site and are drawn to it for purchases or at the very least to generate instore enquiries. Plus if you get a decent response from the pilot it will certainly help you to sell-in the idea and the cost to other stores.

Good luck and please keep in touch if you do decide to run the pilot as I am happy to help you draft a release to generate interest in the media.

Best wishes
Jenna

 

[Jason_Lee]

Some very good ideas there. What is the pilot? My service would include taking orders online and then going to she shop and packing the item myself. Basically, the owner will pay me a fee, weekly or monthly and i will take care of absolutely everything, delivery, advertising etc. They will just run their business like normal but benifit from the online profits also. This will work out cheaper than opening their own website.

 

[Jason_Lee]

Would anyone be able to give me advice and help on my business idea? I really want to take this forward. I know what i want to do but cannot translate this into a business plan.

Thanks

 

[Media Jems]

A pilot is a test run to see whether the idea actually works before too much time and money are invested into something which may be slightly off track...

I would suggest offering to do it for one shop for free for a set period of time and see how it goes...if it works then you know you have a cracking business idea...

I think that you could benefit from some sophisticated online systems which would enable orders to go directly from your website to the store- this would enable them to gather the ordered items together for you to collect and then package and distribute to customers...I would highly recommend Coublis (website is coublis and then a dot com) who have some outstanding technology for linking online order with retail outlets.

 

I would assume that the online sales would not be intended to replace the existing high-street sales - more an additional form of selling to customers who would not necessarily shop in that area.

If you are simply providing a service which locals will use, then there is no real benefit to the shop as they probably would have sold the items anyway.

I like the idea (a lot like an ebay trading assistant - worth a look online for info on how this works?) and I would like to see how well it works out. It might be a great idea or it might suck - you'll not really know until you give it a go !!

Good luck
Mark

 

[Jason_Lee]

Thanks Mark.

The shop will still sell locally from their premises. This service will help broaden their custom. You know how huge the internet it. This service i provide will hopefully increase their turnover as not only will they be selling locally, they will be selling nationally. With my service they will not have to do anything extra to what they are doing now! They pay me a monthly fee and i take care of all their online sales and advertising!

 

[SillyJokes]

My first thought is how are you ever going to know what the shop owners have in stock? You could sell stuff online that they have already sold in the store and you would then let down your online customers.

Listing the clothes and getting images and full desciptions including correct sizing across all the different ranges would be a very tough thing to do too.

What about returns, how would you handle these?

Telephone enquiries about the products, how would you handle these?

And are you really going to run about to each shop to pick and pack the orders? That will be OK when you are doing 5 a week but you'll get pretty sick of it when it's 5 plus a day from 5 different shops.

You would also carry the risk of credit card fraud which is probably quite high on fashion I'd imagine and you'd pay the transaction fees.

You would be the online face for these stores. Can you maintain a good profile. Your website will have to be good and have the same ethos as a bunch of very different shops - can you do this? I think independent shops will want to keep control of their own websites, no matter how bad, I know I would.

This could work but I think it will be very hard work.

I also think that if anyone thinks they can just tickle along a website on the side while they work full time in a shop they have got a shock coming to them. It will either take over their life resulting in them shutting the shop or it will be a waste of their time.

 

Yep, I agree with Sillyjokes (him above, not in general)

What about having a look at the ebay Trading Assistant & trying something like that - getting rid of their excess stock only (the stuff that is taking up space in their stores).

Mark

 

[Millionaire]

Hey SillyJokes; no one got anywhere without at least a bit of hard work! The guy has a good idea, a good industry and with a bit of motivation a good business plan also. This warrants credit.

Anyway Hi Jason, I think you definitely have a viable business. The fact is, most small business owners would jump at the opportunity to increase sales revenue and custom. In this respect you even have a market! This all sounds pretty reassuring to me. However, like many have already pointed out this will be hard work, but not impossible. The issue about not being able to package all the products yourself is ridiculous, if you had that scale of orders you would get yourself some employees. The question you should be asking yourself isn't "is this business feasible?" But moreso; "why would a shopkeeper choose to invest in my website?"

You're definitely right; marketing is key to the success of your business, and so a good marketing strategy will pay dividends. Shopkeepers won't invest if you don't already have a reputation, after all what's ebay without it's buyers? Secondly the design of your website is of paramount importance, it may be a wothwhile investment having this done professionally. Finally just entice both customers and investors, which should be easy providing you have achieved all this.

I'm not too sure about you charging a fixed fee, an agreement like 30% of all profit made on all itmes sold through your website sounds a safer bet to me. Just a suggestion. Also, why only sell clothes, there are many more markets, toy stores, electrical and home stores to name a few, which all require the same services. I understand why you may want to operate in a "niche market" but forget this; think big. The more products you have on offer, the more sales revenue you are likely to generate; the more profit you will have!

Good luck and don't let the criticism put you off, work hard and whatever you do you'll be successful.

Chris

 

[Jason_Lee]

Thanks everone for your input. All the shops i visit will be local so it is not impossible to get to all the shops and package the clothing to send.

The reason i am thinking of just doing clothes is because i am already selling clothing on my own website etc. When i get started i could maybe go into other products.

Also would anyone be able to help me get all this business concept into a solid business plan? This is because i may need a little investment. Anyone who could help me with this business plan would be doing me a huge favour.

Thanks again.

 

[SillyJokes]

Jason I wouldn't want my 'critisms' to put you off.

All I wanted to point out are some of the problems I see with this business which you may not have been aware of. None of them are insurmountable.

But you will have to do the business maths very carefully indeed to ensure you can make money.

 

[Mortime Business Software]

Most of what you desire can be automated by software. Other shops who subscribe to your service could be made responsible for packing and delivering their own sales. You can also allow subscribers to maintain their own identity. Like Ebay, to a certain extent, you should be able to administer and take credit for a system whose customers understand that it is not your fault if something goes wrong with a transaction.

First of all, as a previous poster has already suggested, I think you should examine Ebay's online shop system and think about how yours will be different. Maybe there are lots more features you can offer to subscribers and customers that they don't. The important thing is to try to identify as many things as you can that are not already offered by others, or, if they are, why people are not using them.

If you still want to proceed, the next thing you need to do is write down a "statement of requirements" for a system. From this, you should work with a sytems engineer to produce an "initial structural model" of the system. This is basically a diagrammatic description of the system, together with some initial textual specifications of the candidate software objects involved. Software objects can sound a little daunting to some people, but you can think of them as simply being classifications of objects derived from the real world. Some of their attributes and reponsibilities are also identified at this stage.

After some negotiation with your engineer, a "negotiated statement of requirements" is agreed upon, and from this a "final structural model" is produced. Then a working prototype of the software system can be produced, and development continues from there. A relational database can also be produced from the structural model.

Your shopping system idea is a prime candidate for "object oriented" software, and will definitely need a relational database.

My initial thoughts about this suggested your system should be distributed. That is, you would be a "server object", and your subscribers would be "client objects" who subscribe to your service and sell via your system with client software on their own computers. The customers would also be "client objects" who buy via your system. Some of the software would be implemented as web software (for customers), and some as PC applications (for shops subscribing to your service). Other objects in the system would be necessary to automate the system as far as possible. For example, you might be able to negotiate with a "courier object" to use a web interface, or even a simple PC application so you can send them orders via the network.

The above is a very rudimentary explanation of how a software system could be thought about. It is very, very important to negotiate such a system with a proper engineer because when the system is finally handed over to you, you can be assured that it is fully documented in a manner which will allow any other engineer, and most developers, to understand it and continue to develop and maintain it with a minimum of training. Although your systems engineer is your very best friend until the system is up and running, there is no guarantee that he/she will be around forever. You should also be confident in the integrity, efficiency and security of the system.

Hope this helps.

All the best with whatever you decide to do,

Dave

 

[Mark Nagurski]

Personally I'd go as simple as possible - probably along the lines of what you were thinking of yourself. Dave's totally right in what he says about developing the system but my gut feeling is that it's something you'd like to try, see if it works and then possibly ramp it up in the future.

With that, and the fact you already have a site in place, I'd simply approach a few local biz with the idea in principle. From that rudimentary market research you can then highlight some of the sticky points (which will probably include - as mentioned above - knowing what stock the other businesses have).

If it sounds like a 'goer' then use what you learned to draft a business plan and run a pilot program with a few businesses (probably without the monthly fee) and list a few items of their stock along with a tag on each saying its also available at X store.

Again, use the info from the pilot to refine your plan. Then add a few more businesses and repeat. IMHO I'd stick with the clothing for now to help build a brand.

You've probably have a gut feeling about how you want this to run - sometimes it's easy to over think things - stick with your gut, have a go and see what happens. It's a low cost idea and - so long as you can ensure order fufillment and quality - can only enhance your own site and brand image.

Or, if you have the budget to do it, forget all that and go with Dave's plan

And of course, if we could be of any help with the marketing plan feel free to get in touch.

 

[Mortime Business Software]

Sure Mark. You are right. I did not intend my post to be a "business plan" or anything. Sorry if it sounded that way Jason. Maybe I didn't express myself adequately. A "system" for carrying out the required tasks would form one section of an overall business plan.

What I was trying to say is that the idea should be approached systematically and not just cobbled together in a disorganised manner. I was also trying to emphasise that the vast majority of the tasks that such system should do can be automated, and that many shopping centres in many towns could be included by sitting a private network on the internet.

But yes, in the research stages, the system could be written down "on paper" and simulated with web tools and some legwork. A proper artist will make preliminary sketches of a subject in order to understand it before he chances wasting valuable time by executing a painting in expensive oil paints.

Also, the system should not just include the tasks of selling, communicating, etc., it should include how customers and subscribers are to be notified of the service. This would surely require that the proposed system should be integrated with Jason's current system. At the outset, an idea such as this should be regarded as a "potential" development of his current system. If it turns out to be profitable, then it should be automated according to what he can afford so that the maximum profits can be realised.

If I were to start on such a venture, one of my first tasks would be to "standardise" as far as I possibly could. A general consensus of some standards could be reached locally, then, if the venture looks promising, have new subscribers conform to those standards.

By the way, you don't need too much of a budget to engineer a simple, prototype system. It can be specified on paper before any software is implemented. Indeed, this is absolutely necessary for any serious software system to be successful. The reason I say not "too much" of a budget is for the reason you have implied. That is, if the research shows that the idea is viable, the money spent on automating it is peanuts compared with the projected profits.

Dave

 

[Mark Nagurski]

Good point Dave - hvaing standardised procedures and systems from the get go is a def. key point. In doing so you allow business plan to become scalable - so when it takes off you're well positioned.

Once it does take off automating many of the processes in the way Dave describes will be fundamental to allow you to get on with the marketing and communications aspects of the business.

I suppose my point would be - from a marketing point as much as anything - to not let the potential problems dampen your enthusiasm for what seems a neat way of building your business.

I've often found when I get bogged down into the nuts and bolts of new campaign for a client I can loose site of the simple idea that inspired it. In the end I almost always go with the first gut instinct and try to keep it as simple as possible.

My advice, hire Dave to develop your systems and I'll do the marketing LOL

 

[Mortime Business Software]

Mark Nagurski...
~~~~~~~~~~~~~~~~~~~~~~~~~~
hvaing standardised procedures and systems from the get go is a def. key point. In doing so you allow business plan to become scalable
~~~~~~~~~~~~~~~~~~~~~~~~~~

"Standardising" a system as far as possible is, in my opinion, non-negotiable for any serious system which needs to be maintained and developed by *anyone* with the relevant skills, just as a comprehensive "maintenance manual" is indispensable for a washing machine.

Can you imagine buying a car or a motor-bike which does not have a maintenance manual with full specifications on all the components and how they interract? A vehicle without specifications or standards is clearly absurd. Now considering that a system such as the one Jason is proposing could become more complex than, say, a motor-bike's system, (including the engine and its components), it should be acknowledged by any serious businessman that a "maintenance manual" is absolutely essential if the system is to be developed and extended with a minimum of fuss.

However, just as a complicated motor-bike system was developed from the simple push-bike system, so too can a thing like a simple "distributed shopping system" be developed into a more complicated machine which benefits not just the owner/inovator, but also the customer.

Mark Nagurski...
~~~~~~~~~~~~~~~~~~~~~~~~~~
Once it does take off automating many of the processes in the way Dave describes will be fundamental to allow you to get on with the marketing and communications aspects of the business.
~~~~~~~~~~~~~~~~~~~~~~~~~~

Again I think you are correct. And I think you are also correct in emphasising marketing. I don't care what anyone says, for the majority of start up ideas and ongoing businesses, their work can only be secured with sensible advertising and marketing. The idea that a product can "sell itself" is ridiculous.

Presently, the computerisation of the world seems extensive but, in fact, the revolution is still in its infancy. However, we are now at the stage where forgoing "automation through software" for the sake of saving a few quid means failure. Whether we like it or not, software is absolutely indispensable for the maintenance and development of the world as we know it. Yes I know that all of you have heard it all before. But take an hour or so to really, really think why it is true. Think about all the systems, from your flashy electric kettle, through your motor-car and traffic lights, to stock exchanges and jumbo jets, that would simply crash without pieces of human thought written in binary code to produce software.

Phew! That must be the first time I've gotten so philosophical for a while!

Anyway, I would be very surprised if Jason's idea has not already been thought about and acted upon.

Let me let you into a little secret. I thought about something similar to Jason's idea about 5 years ago. It involved thousands of hotels in my home town of Blackpool. At that time I had two years of self-taught skills and some commercial computer-programming experience behind me. The principles of the system I had in mind at that time could be easily extrapolated to what Jason is thinking about now. There really is nothing new under the sun.

So how on earth would Jason be able to succeed with such a trite idea? Answer: by *doing it* of course! If Jason has found that there are many clothing retailers who don't want to, or can't afford to, have their own websites, for whatever reasons, then it would seem that he has identified a passage to increase his earnings without as much effort that would normally be required.


Mark Nagurski...
~~~~~~~~~~~~~~~~~~~~~~~~~~
My advice, hire Dave to develop your systems and I'll do the marketing
~~~~~~~~~~~~~~~~~~~~~~~~~~

I'm afraid I'm still not quite ready to unleash my revolutionary and world-saving brilliant ideas on the world yet! I currently have 70% of the points which I require for my computing degree. By the end of next year I will have 90%. The following year I will have more than I need, and only then will I have the face to put "system engineer" next to my name.

However, that doesn't mean I can't dole out some advice on what I have already practised. And, let me tell you, *practised* I have! Computing is a branch of mathematics and I just looove the stuff!

What's more, all this means I'm free of charge for at least the next couple of years. Really. If anyone like Jason wants me to do so some work, it's completely free. Why? Because I want some experience of dealing in the real world to complement the academic stuff.

Thank you Mark for making this a very interesting and educational discussion. It has confirmed my existing beliefs that your job is as important for a business as a front door key is for a house. Without the sheer guts and cheek that you people are prepared to show, the world as we know it would not exist. I know because I've done a bit of it myself down on those packed but lonely streets. I hope I will be able to work with you in the future.

Dave

 

[Mark Nagurski]

Glad we agree on so much Dave. Always a pleasure to participate in a good constructive debate.

If I can add one final point, what makes a truly great business is when infrastructure meets 'guts and cheek'.

Jason - best of luck and make sure to let us know how you get on.

 

[theMBA]

Sounds like a great idea to pursue.

You'll need to be careful which shops you offer this service to. Many that belong to chains will have something like this already set up within their own HQ/branch arrangements. They represent competition.

A business plan is a must, and most important will be sorting out what you expect the financial numbers to be, taking into account volumes, margins, overheads.

Size is another important factor - how fast will you be growing, and at what points will you want extra staff or a trading partner (eg logistics operator) in order to cope with growing demand.

I'd support other people's suggestions about running a pilot for a while to 'test' the concept and see if it can be made to work (and make money). Then go for growth. During the pilot, you could construct your business plan based on solid experience - your forecasts/projections will be more accurate as a result.