When it comes to on-line trading success, one of the most popular metrics for success is profit. Money in the bank allows for business expansion / growth, life balance and personal success. Here are our Top 4 ways to help you get there:
Find Suppliers With The Right Cost: Conducting strict due diligence on suppliers is vital to your on-line success. Typically, you’re likely to be selling items already in the marketplace somewhere. You’ll need to determine your ideal pricing levels in comparison to those in the market as well as any specific points of difference your product and services to your competitors. Being armed with your own price point, the next stage involves determining areas within your suppliers where costs are involved, to bring out the product’s margin. Total supplier cost to your business is more than their sale price. There’s going to be potential expanse in shipment, replacement of defective goods, customs and duty taxes and fees in paying your supplier through credit card or payment gateway.
Skills In Negotiation: Knowing and understanding your products on an intimate level is vital – you’re able to talk and negotiate with authority.
Comparative pricing: Negotiating is common place and we use it everyday. Alibaba allows you to pull in supplier quotes from around the world which makes this method exceptionally easy. You’re culling the very high priced suppliers as well as culling the lower ones using a filter around quality and other issues and with a little back and forth conversation, you’ll settle on the better one that suits your requirements.
Less than your current price method: Is often used by those in a hurry. If you’re getting the exact same product for cheaper then that’s got be a good deal It’s not surprising many hinge their decision making with this method.
Reverse input method: Requires extensive product knowledge including input material cost, delivery fees, hours in labour assembly as well as waste levels – basically everything there is to know. Add to that, you also understand these same factors within China. If you’re this type of on-line trader, you’ll really know who’s giving you the best deal.
Product Pricing Mark-Up: This requires determining your competitors product pricing, whether you’re simply looking to undercut the market with volume or ‘value add’ to gain additional product margin. Once you’re determined where your product sits in the marketplace, you’ll have a much clearer understanding on the mark-up percentage you’ll be able to apply to the product.
Customer Experience: This is by far the most crucial aspect of a long term business model when it comes to sustainable profit. Studies show 53% of on-line users are highly likely to believe in recommendations from family and friends with 48% of on-line potential users highly likely to make a purchase based on these recommendations. With these sorts of statistics, you must ensure you maintain a highly motivated customer base, through regular feedback and communication. Word of mouth marketing plays a key role in client base and profit expansion.
Your Turn Do you have any other tips in ensuring your on-line business maintains profitability? Do please let us know in the comments section below.