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Thread: Online vs B&M

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    Default Online vs B&M

    Owning my own store has always been a dream of mine. The idea has been weighing heavy on my mind lately and I keep telling myself why not go for it. The only thins is I have know idea where to start! I'm not sure if having the business be solely e-commerce vs B&M is more beneficial. There are benefits to both, e-commerce will cut down on overhead costs, while Brick and Mortar will allow me to engage with the customers face-to-face.

    I am also seeking information on sourcing...I know there are tradeshows to attend which are great networking opportunities but I'm not up-and-running yet. I have reached out to UMB Fashion the folks who present MAGIC in Las Vegas, and they informed me I AM able to attend as a Start-up company however I WILL NOT be able to attend again until I'm a fully functioning business. Is it wise for me attend now (unable to make any purchases-only to network with vendors) or should I wait until I have a better understanding of the direction in which I'm going?

    Any advice, referrals, or other info is greatly appreciated...Thanks in advance!

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    Quote Originally Posted by KFrame View Post
    Owning my own store has always been a dream of mine. The idea has been weighing heavy on my mind lately and I keep telling myself why not go for it. The only thins is I have know idea where to start! I'm not sure if having the business be solely e-commerce vs B&M is more beneficial. There are benefits to both, e-commerce will cut down on overhead costs, while Brick and Mortar will allow me to engage with the customers face-to-face.

    I am also seeking information on sourcing...I know there are tradeshows to attend which are great networking opportunities but I'm not up-and-running yet. I have reached out to UMB Fashion the folks who present MAGIC in Las Vegas, and they informed me I AM able to attend as a Start-up company however I WILL NOT be able to attend again until I'm a fully functioning business. Is it wise for me attend now (unable to make any purchases-only to network with vendors) or should I wait until I have a better understanding of the direction in which I'm going?

    Any advice, referrals, or other info is greatly appreciated...Thanks in advance!
    If there's a Walmart or Target within a 10 mile radius, sorry but B&M is a bad idea. If you're going via ecommerce, let me give you some more advice. Niche companies don't really work anymore. I'm talking big Niche companies (Staples, Best Buy, etc.) but if you make a niche product on Etsy, you're good for now.

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    Quote Originally Posted by Owen View Post
    If there's a Walmart or Target within a 10 mile radius, sorry but B&M is a bad idea.
    Hate to break it to you Owen, but there are thousands of small businesses that survive inside that 10 mile radius. They just have to cater to a different customer and market properly.
    Brad Miedema
    Fulcrum Saw & Tool

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    Quote Originally Posted by Fulcrum View Post
    Hate to break it to you Owen, but there are thousands of small businesses that survive inside that 10 mile radius. They just have to cater to a different customer and market properly.
    I'm just assuming KFrame has no experience in this to know how to cater differently.

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    eCommerce is hard. Very hard. Very competitive. As opposed to a B&M where your competition is pretty straight forward and it's easier to target your market because they are right there in one city.

    It may seem like less overhead, but it requires A LOT OF knowledge and you will still spend thousands setting it up, and marketing it. I'd only go the eCommerce rout if you know how to market it or understand that you don't know how to market it and that you will have to learn, hire someone, and that it will cost money and take time.

    Even if you do brick and mortar you should have an online shop.

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    Quote Originally Posted by Harold Mansfield View Post
    Even if you do brick and mortar you should have an online shop.
    There's a reason there's all these horror stories about Walmart and Target destroying mom and pop shops. Mom and pop shops don't invest into things like this as they feel that making a whole website and actively investing in it is too expensive or too excessive. They want to remain small, but reality is you're competing with massive corporations who have the money to turn you inside out in the span of about a day.

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    It's really hard to advise without knowing what your target market is. It sounds like you want to do something in fashion?

    Last year I launched an online-only pet supply shop. It's been slow but I'm still here and have learned a lot of good things. First off, you must analyze your competition. I recommend that anybody trying this do NOT try to get into the cheap commodity product sales, because you WILL be wiped out by the major retailers. Whether you're B&M or online, the majors will eat you up. My biggest challenge is to avoid competing directly with Amazon.com, Petco and Petsmart. So I've positioned myself into the higher-end products and market myself to more affluent demographics rather than bargain hunters. You still have to keep a close eye on those majors.

    I think that starting online-only is a good way to launch the business because of the low-capitalization/up front costs. You can get established, and then as the business grows, you can get afford to get yourself into a B&M storefront. That's my expected growth path, although I toss around alternatives. I could just get a warehouse space which is cheaper than retail spaces, on the other hand if I have a physical presence, why not allow some foot traffic in to buy face to face? But there are tradeoffs between warehouse and retail, so I'm enjoying allowing myself time to mull it all over.

    I very much, extremely recommend doing a business plan. That will kind of force you to analyze your potential market and competition and will allow you to refine your idea or dump an originally bad idea for better ones. You can omit sections of a business plan template that you don't need. For example, I didn't bother with the parts related to loans or capitalization because I didn't need them. But my business plan was valuable enough that I've done a lessons learned last month to highlight things I got wrong and can do better this year and did a new business plan for this coming year.

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    Let me add another post instead of editing my previous one to avoid the edit timeout, so I can answer your question about sourcing. Here is what I did and discovered:

    I started out locating suppliers by using Google. Seriously! I searched for "wholesale pet supplies" and "dropship pet supplies" and variations of those. I then emailed the ones I found who had products that fit in my business vision. A few had requirements that I couldn't meet (established credit histories with other suppliers and references that they can check), so I skipped those. But some simply needed my contact information and a credit card (I use my business debit card). That got me launched with a reasonable product line.

    Over the year I've dropped a couple of suppliers and added others to refine my products. At first a lot of the products I had were commodities that you could buy for less at Amazon.com. Over the year I've been able to find more unique, non-commodity things, which puts me less in the position of competing with Amazon. I think if you're in retail, depending on the market you're working in, you might need to constantly be reviewing and revising your supplier list.

    I also discovered by working through my business plan that in working through a competitive analysis I stumbled upon potential suppliers. Also when looking for suppliers, I stumbled on competitors. It's really nice how you can work back and forth to fill out all the different parts of your business.
    Last edited by SumpinSpecial; 01-15-2017 at 09:32 AM.

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    Quote Originally Posted by Owen View Post
    There's a reason there's all these horror stories about Walmart and Target destroying mom and pop shops. Mom and pop shops don't invest into things like this as they feel that making a whole website and actively investing in it is too expensive or too excessive. They want to remain small, but reality is you're competing with massive corporations who have the money to turn you inside out in the span of about a day.
    I agree. Anytime you go into anything half-ass, you're going to lose. I see a lot of people do this.."We don't want to spend a whole lot of money until we know it's going to be successful".

    The problem with that line if thinking is that there is no guarantee that anything is going to be successful. You HAVE to give it 100%, or you will fail. There is no dipping a toe in first. That's why you do research BEFORE getting started. To determine if there is a market, and if you can tackle that market and make a profit. If you've decided that you can, then you move forward with determination.

    If you've done no real research, of course you're going to be timid about jumping in with both feet because you haven't validated your idea, therefore your don't have any actual confidence in it, or yourself. This is already a recipe for failure.

    Today there are some things that are absolutes and aren't up for discussion if you're serious about starting a business, and the first one is that you MUST have an online presence, and it MUST be done well. Without it you're leaving money on the table and you'll never know how much. No one is going to call you and say, "You know, I was thinking about spending money with you, but I couldn't find anything about you online and what I found was unprofessional, so I spent my money elsewhere". That call never happens.

    Not saying a website is a guarantee. That's the point, there are no guarantees except that NOT giving it 100% is guaranteed failure.

    I understand budget is always the issue with start ups. Do what you can, well. Don't skimp because of fear. It's all fear. Whatever you think you're saving by NOT investing in something important, you're going to spend that money anyway and still not have what you needed.

    Do what you can with what you have, spend wisely, but always be looking to improve.

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