Many small businesses in the UK currently don’t take enough advantage of trading online.
Plenty of businesses have websites, but as few as ten per cent of these allow customers to buy goods or services online (DTI 2002 Prodata Report).
Without the ability to pay for goods online, some businesses are missing out on a big opportunity.
Here’s some reasons why:
- Growth – the more sales channels you have, the more opportunity you have to increase your customer base. More customers mean more revenue.
- Convenience – trading online allows your customers to browse and buy at a time to suit them
- Choice – online you can offer a wide range of products without having to produce and update paper brochures which can be costly and difficult to get right
- Improved cash flow – payment at the time of purchase reduces the pressures caused by 30 day invoicing
- Reduced costs – removing administrative resources required by invoices, and processing cheques and cash.
Who can trade online?
There’s a common misconception that trading online is only relevant for well established businesses, yet more and more businesses are starting up with the ability to accept online payments.
Equally there’s an accepted belief that trading online is better suited for businesses that sell physical goods.
The truth is, that businesses offering services such as design, architecture, accounting and travel can also take advantage of selling through a website.
Trading online involves technology that most people aren’t familiar with, so it can appear quite daunting.
To start trading online you will need:
- A website
- Ability to take payments online
- Ideas for online marketing.
When looking to actually sell your wares on the internet, you first have to make a choice: build your own website or set up a store via a third-party like eBay.
Creating a website
To create your own website you’ll need a web address, a hosting service and a website. The DIY option is a little more complicated than paying an expert but you’ll have something that reflects what your company is about and in the process acquire valuable skills.
You could also find this the most cost effective route to getting your business online – the costs of building your own website can be as little as £500, although probably more if you want one that can be used for trading online.
Website design is offered both by small businesses and large agencies. Look in a local directory or search the web for someone in your region and make sure they know how to set up a website that supports trading.
There are many companies that sell web addresses, which is also known as your URL or domain name. They will normally cost anything from £10.00 to £25.00. Using your favourite search engine look for ‘buy web address’ to get a choice of companies listing and selling web addresses.
See our guide: Getting and setting up a business domain name
For people to be able to visit your site at any time of day or night it has to be hosted (stored) on a computer permanently connected to the internet, called a web server.
To start with, most small businesses choose to pay a third party to host their site. Hosting is offered by a large number of companies and what they offer will vary dramatically in terms of technical support, features and space allowed. Don’t forget to ask if they’ll support online trading.
Online payment solutions
Ideally, you want to allow customers to pay online. As we’ve mentioned, this will offer your customers more convenience and allow you to reduce costs and improve cash flow.
There are many online payment solutions to choose from. The best one for your business will depend on online turnover, the average value of transactions as well as borrowing and overdraft rates.
See our Taking Payments section for advice
As a starting point it’s a good idea for small businesses to choose a low fixed cost and easy to use solution. Type in ‘online payments’ into your favourite search engine and see what results come back.
Once you’re able to offer your customers the ability to buy as well as browse, the final step is to make sure you’ve got enough visitors who want to buy.
The good news is that there are now many proven techniques and easy solutions for getting more customers to buy online from you more often.
Obviously the difficult part is rising above the crowd and differentiating yourself from your competition. This is where a well thought out internet marketing plan can help. Here are the main components of any good online marketing plan:
- Registering your site with search engines and directories
- Optimizing your site for search engines through using the right metatags (hidden information describing your site)
- Sponsoring search engine keywords
- Building a database of customer email addresses
- Sending email newsletters
- Buy online advertising space.
Fact: One of the main benefits of the internet is that it offers small firms the opportunity to reach a much wider audience than before – and greater convenience when dealing with suppliers.