Don’t Want to Fail in E-commerce? Then Must Consider These 15 Factors

Do you want to start your e-commerce store? and you don’t want to fail in it? Then you are at the right place. This article is specially written for the beginner who is planning for an e-commerce store.

In this article, you will get to know about all the factors that you should consider before starting an e-commerce store.

This article is not based on any theory. it is based on practical experience and if you are serious enough with your e-commerce career then you will definitely learn a lot of things from it. So keep some patience read this article fully.

Factors Need to Consider Before Starting an E-commerce Store

1. Budget: 

The most and prime important factor in e-commerce is budget. Before planning for e-commerce you must have to plan for its budget. Below are the questions, you must need to ask yourself,

a) How much money I can put into it?
b) How I will raise the money to keep this e-commerce store up and running?
c) What kind of expenditure do I have to bear with it?
d) How much will be the setup cost and running cost of my e-commerce store?

There are multiple questions that you need to ask yourself for starting e-commerce but the above questions are major and essential if you don’t want to fail at the very beginning.

Also, consider the type of investment budget you will need for these parameters.

a) Investment for your online platform (application/website)
b) Investment for product inventory
c) Investment for marketing of your store
d) Investment for other expenses like shipping, packaging, and labeling.

2. Product: 

If you fail to choose the right product for your store then you choose to fail for your eCommerce store and this is the center focus of your e-commerce store. What if you are planning to sell a product that has no demand in the market or multiple people are already selling this at chapter price, then the chances are more to fail in the e-commerce industry.

You must have to study which product you are going to offer to your customer and before choosing the right product you need to do a lot of Market research about it.

Ask these questions while selecting the right product.

a) How many competitors do you have for this particular product?
b) What is the cost of the product?
c) How this product is selling in the market?
d) How is the demand for this product in the market?
e) Is it available in the market easily?
f) Why customers will buy this product from me and not from others?

If you are planning to sell a variety of products in your e-commerce store then you must have to think about how you will manage the activities for this multiple products e-commerce store. For eg., If you choose shoes as one of your products then you need a different variety of them and for a single pair of shoes, you need different sizes, different colors and different styles of them. So you will have to consider all these factors while choosing a product.

3. Technology (Online Platforms): 

E-commerce means electronic commerce and that means you need to have an online store for selling your goods. You need to think about the technology that you are going to use in your store.

Three types of Platform commonly available for eCommerce store

a) E-commerce Website
b) E-commerce Mobile Application
c) Third-party Platforms (like Shopify, Big Commerce, Woocommerce)

But what is complex in choosing an e-commerce store platform?

a) If you are going for a website then there are multiple technologies available in this market only for e-commerce websites and every technology has its own benefits and limitations. By considering the nature of your e-commerce store you can choose suitable technology for your store

b) Same rules of technology applies to a mobile application but another fact is that you want your customer to download your app on their devices. For this, you have to give a strong reason to your audience to download it and keep it on their mobile devices.

c) If you are going to choose any third-party platform then you must have to think about it for the long term like what if that third-party platform increases their prices in the future or what if they apply some restrictions on your stores.

These are all the reasons that tell you to must have taken this technology factor seriously.

4. Return on Investment (ROI and Your Profit-Margin): 

Now you have a budget and you also have chosen the product and technology for your e-commerce store. But the whole purpose of the business is to generate profits and margins by putting some amount of investment in it to keep your e-commerce store/ business up and running. And what if you do not think about it in the beginning phase of the business? What if you do not have any profit margin model in your e-commerce store? What if you are working hard but not able to generate any profit from it? then you will definitely get failed in it, No matter whether it is e-commerce or any other type of business.

We’ll understand this with the help of one example,

If you are getting your product at Rs.200 and if your selling it for Rs.600 then what will be your profit?

Many of us will say Rs.600-Rs.200= Rs.400 will be the profit. that is wrong. you have to think in a deeper way.

The product price is Rs.200
For shipping Rs.50
For packaging Rs.20
For marketing Rs.20
For other expenses Rs.10

Then your product price will be Rs.200 + Rs.50 + Rs.20 + Rs.20 + Rs.10 = Rs.300

Again you are selling it for Rs.600 then now your net profit will be for a single product = Rs.600-Rs.300= Rs.300

Now consider for starting this e-commerce store you have invested Rs.30000 in the beginning.

To achieve your break-even point( no loss – no profit point) how many products do you need to sell?

to calculate this will do one simple calculation = Amount you have invested / profit from a single product = 30000/300 = 100

To achieve your break-even point you need to sell 100 products and after that, you will be getting some actual profit.

This is a very simple calculation but it is important for you to understand this in the very beginning stage to run a profitable business.

Also if your product and marketing are strong then you will achieve this in a single month or less than that. (please note I’m talking about the new e-commerce stores and the beginners. if you already have some brand value then it is much easier for you)

5. Marketing: 

Marketing starts before the product selection because you need to do market research for the selection of the right product. Ecommerce is not about setting up the store and seat and waiting for the orders to come. It’s about sending the right traffic at a right time with the right message to your e-commerce store and this is only possible with strong marketing. We can say if our e-commerce store is gun then marketing is the bullet of that gun.

Greater marketing efforts will generate greater sales results. As we have going to run an e-commerce store and for this, we need a digital medium of marketing (Digital Marketing) to promote it. Please note that marketing will only work when you target the right audience otherwise your effort will not be able to produce results.

Paid ads via digital marketing will be a very powerful medium to drive traffic to your online store. You can also go for product SEO for long-term organic traffic. Allocate optimized budget to the marketing of your store and run optimized ads for better ROI.

6. Type of E-commerce Store:

There are 4 major types of e-commerce store and the reason for discussing them is that we need have an idea about which type of store we’re planning.

a) Dropshipping: In this model, you have to bring orders for the others people’s stores under your brand name and then transfer these orders to dropshippers then they will ship it to your end customers. You don’t need to take care of product inventory, product shipping, packaging, and customer support. You just need to bring orders. In this type of e-commerce, store risk is low but there are also some limitations and restrictions. For. eg dropshipper can stop your contract with them also this is not suitable for long term.

b) Traditional E-commerce Store: In this type, you can tie up with some local sellers and list their products on your own website. It also has a low-risk factor but you need to depend on them to run your store.

c) Selling Your Own Product: You need to take care of everything like Product, Product inventory, Product delivery, and packaging, etc. The risk is high the profit is also high and you have all the control of your store on your end. Dependency is less but you need to work hard for running this. My personal advice is to go for it.

d) Affiliate E-commerce: In this, you have to promote other people’s products online by their own brand name and for every sale, they will give you some affiliate commission. Low-risk, low-profit type of e-commerce with lots of limitations. if you don’t want to take risks and want to check your ability to sell online then you can start with this type.

7. Multiple Products Ecommerce Store: 

If you are planning for multiple products e-commerce store then you will definitely need a team to handle all the operations.

But why I’m saying this? Let’s take an example, if you are planning for a fashion e-commerce store (for eg. shoes and clothing) then for each product you will need different sizes, different colors, different styles in your inventory. 

Investment is more as compared to niche store and if you are solopreneur and planning for it then my advice is to don’t go for it.

Now you’ll say but Ayaz we can tie up with our local seller and we will don’t have to keep an inventory and that means no extra investments in products.

Yes, you’re thinking in the right way but most of these local sellers do not have an idea about how e-commerce store works. And your challenge will start from here.

For taking their product on your website you will need to do photography of each product by going to each seller place then you will need a product photo editing for each product. 

Another challenge is that what if they don’t have enough stock and you got an order for the same product. what if after setting up the store and listing their product on your store they don’t ready to co-operate? and you will not have real-time product stock idea in their store. 

To overcome these challenges you need a team. you can not do all these things yourself. Must consider this important factor before going for it.

8. Niche E-commerce Store: 

It is a very good concept for solopreneur (who want to start their store by themselves). If you are a single person and want to start your e-commerce store then starting with a niche will be the best idea for you. 

In this store, you need to sell only 2-3 types of products like you can sell fitness equipment (like Weight measuring machines, Gym mats, etc.) in which size is not a variable or very limited variation. Another advantage is that you can easily research your target audience and targeting a smaller group of people is easier than targeting a wide range of people.

And when your target audience is limited to a niche then it will be easier to study their customers’ psychology, their buying behavior, and other things. You can start this store with a minimum budget.

9. Shipping: 

Every customer wants fast delivery of their purchased product. And this is another important factor to be considered in e-commerce because customer has to wait until he gets their products. For this, you need a solid delivery partner who can deliver your products to your end customer faster and smoothly without any damage. and having good customer support from the delivery partner is needed in the proper functioning of e-commerce stores.

Consider various factors whiles choosing your delivery partner because they will directly affect your e-commerce business. See their past reputations, delivery rate, and customer support facility.

10. Customer Support of Your E-commerce Store: 

Strong customer support builds trust among your prospect customer and if you don’t have that then you cannot succeed in this game. Because this business works on trust factors. many stores do not accept cash on delivery and in this case, a customer wants somebody from your end who can assure them about the guaranty of product delivery, and if some issue came then customer support is there to help them.

You must consider this factor that how you are going to provide customer service for your e-commerce store.

11. Differentiating Factor: 

Because of the ease of technology, many people are starting their e-commerce or some people are planning to start their e-commerce store and this is the truth we cannot avoid. 

In this competitive environment, you need to stand unique and have to think about the differentiating factor which means how your e-commerce store is different from the other competitors. Why customers should buy from you and not from your competitors. What will be that differentiating factor there in your e-commerce store. 

Consider this factor to avoid the fear of competition later.

12. Time factor: 

When you start your own e-commerce store, you need to keep patience in the beginning at least don’t think for plenty of orders for 6 months. 

Your store is new and it will have a low trust factor, doesn’t have any brand value and also it will not rank on google in the beginning and that’s why we can’t expect much orders and profits for first few months and you have to keep this in your mind before starting a store. 

also please be prepared with your cash flow and budget according to it.

13. Amazon / Flipkart: 

Giants of e-commerce in this world. You don’t need to see them as competitors. In the earlier point, we discussed the time factor and we need to keep patience in the beginning to get lots of orders. 

To overcome this orders gap you can be the seller on Amazon and Flipkart and you can easily get orders from these websites /applications. Because they have built their brand value and people trust them. It will be a great help for you to list your product on their websites. 

And when you start getting some good orders on your own website then you are free to close your sellers’ account and can completely focus on your own store.

14. Return and Replacement Policy: 

To be in a profit by keeping your customers happy, you need to decide on a strong and customer-focused return and replacement policy. 

Think deeper and think from both perspectives yours and as well as customers perspectives. It may affect your business and brand reputation. 

In most cases, if customers don’t have any return and replacement options then they will feel worried to place an order. We’re also a customer of someone and we too check return and replacement policy while placing the orders.

Another thing is that if you have a return and replacement option then you have to bear with the product and shipping expenses. So please keep this in your mind while preparing your store return and replacement policy.

15. Terms and Conditions Policy: 

Having a strong as well as customer-friendly terms and conditions policy will help to avoid any legal issues. It will also protect you from someone who can harm your store in the future. Must prepare a strong terms and conditions policy for your e-commerce store to avoid any legal issues.


I hope now you have a clear idea about the factors one must consider before starting an e-commerce store that will help you to avoid failure in long term. I’m pretty sure that if you consider these factors then you will not gonna fail in e-commerce. 

If I have missed some factors in this article then feel free to mention them in the comment section. also let me know your feedback in the comment box. 

For any queries, you can use WhatsApp button available on the website or you can click here to connect with me Connect with Ayaz Shaikh

Leave a Comment