starting an online store - steps to take

[imadam]

ok so i know what i want to sell, i've found who can supply it and worked out the costs etc of what i can afford and what i hope to sell it for. i've found a cart and currently setting it up.

what other steps do i need to take before i can get selling?

i'm looking into delivery options now but as the items are fairly small i'd expect royal mail would be the most used option, however courier will be needed for bigger orders so how do people do this? would a simple parcel2go check be good enough or do people usually sign up to go with just one delivery company?

the value of the goods will typically be around £40 per order so not huge orders.

i've seen many people suggest wordlpay as a payment option. is this still the best idea for a small online store? i've thought about paypal to get started though wonder if only paypal will put customers off?

what about insurance for the items? do i need anything or will this come with the courier so if something gets damaged/lost in transit then i'm covered? the same with fraud?

anything i may not have thought about?

 

[JPincas]

Imadam - congrats on setting yourself up as an online seller. I'm actually writing an article at the moment about the first things to consider when starting out - I'll post a link when it's done. Until then, I'll answer your specific questions:

would a simple parcel2go check be good enough or do people usually sign up to go with just one delivery company?

The normal route would be to open an account directly with a courier company, gaining access to special volume pricing. However, at first your volumes are likely to be too low for them to offer you attractive pricing. From experience, I'd say you need to be doing at least 100 despatches per month with them before they will offer a realistic price. The alternative, then, is to use broker services like parcel2go or Interparcel, who will offer you really good rates straight away, until you have enough volume to talk directly to a courier. The downside is the customer service - it can be hard to actually get to talk to someone with any power to do anything.

i've seen many people suggest wordlpay as a payment option. is this still the best idea for a small online store? i've thought about paypal to get started though wonder if only paypal will put customers off?

There are a couple of issues here. Firstly, I would definitely recommend offering proper credit card payments (not just via PayPal) to customers. Businesses that offer only PayPal look slightly 'dodgy' to me and I have the feeling a lot of customers concur. Certainly, our online business didn't start to take off until we offered credit card payments.

No doubt it is a pain to set up - and you are likely to have a lot of headaches along the way, but I really think it will be worth it in the end. However, do still offer PayPal as well - I've seen a steady rise in the proportion of PayPal payments over the last year, so it is definitely gaining traction.

As to which payment gateway/merchant account combo you use - I guess everyone will recommend something different. I would personally go with Worldpay/Streamline as they are the same company and work well together. With FSB membership, the pricing is good too. They also have some good tools to help protect yourself against fraud.

what about insurance for the items? do i need anything or will this come with the courier so if something gets damaged/lost in transit then i'm covered?

It depends on the item and this is one of the (many) things you have to talk to the courier about if and when you open an account with them. Generally, the courier will cover for damage or loss, but with a couple of provisos:

1) The procedure for making a claim can often be so burdensome as to make you not want to bother.
2) They will only pay you back the cost price and you have to justify it.
3) There is a big long list of goods they won't cover - and that includes loss as well as damage. Make sure to check in their T+C's.

anything i may not have thought about?

Yes, quite a lot. But as I said before, I'll try to cover everything in an upcoming post.

Best of luck.

 

[KateCB]

1.Make sure you undertand and comply with DSR is applicable to your goods.

2.Couriers - we used Royal mail for 4 years until goods got too big (Larger orders not larger goods!) and then wen tot APC couriers - we send out around 400 parcels a month with them, and still use Royal mail for small items under 1kg in weight - RM business account will save you money on psotage costs, they do ask that you are sending 5000 items a year, however they never, ever check - we don't send that many with them and never have, and our business account runs smoothly!

3. Insurance - Royal mail - recorded delivery only pays UP TO 100 times the cost of the service (i.e. first class stamp, no idea how much that it now though!) so if your goods are £40 you should be covered - bear in mind though that as JPincas says, you have to prove what the goods cost YOU and that is what they will pay - not the retail cost that your customer paid. Courier Insurance is different, there is usually an excess of £50, same rules as the PO, prove what it cost you and that is what they pay, less the excess AND that is if you take the insurance option (ours is 50p per consignment if we want it) each time - if you DON'T take the insurance option, then you are not covered - end of story! If the goods are only £40 retail, then the excess wipes it out - you would have to pay them to claim!

4Merchant account - we added PayPal 2 years ago, we have had a merchant account for 12 years, that said, merhcant accounts have monthly fees involved, so until you get repeat/regular custom, you have to be able to afford the fees to start with, whether you sell anything r not - PayPal is essentially a pay as you go system, which can help build capital. WE use HSBC for our merchant account and SagePay for processing the payment - £20+VAT per month to Sagepay and then the rates for credit/debit cards from HSBC, both paid/taken monthly from our business account.

Hope that helps, good luck!

 

[imadam]

thanks for the reply. helped confirmed a few things. can you post in here when you make the new article as sounds to be exactly what i could do with reading.

 

[p2g_qc]

Hi,

My name is George Iveson I'm part of the quality team at Parcel2go and can be contacted on here or by private message if anyone needs help or advice.

Kindest Regards
George Iveson