Money is still not the deciding factor for the success of an e-commerce project in Quebec today. A good idea, stand-out products and a little will power can get you even further. To start up a project, there are many reasonably-priced solutions available, such as PrestaShop or Magento for open-source solutions or Shopify for a hosted solution.
Compared to projects costing hundreds of thousands of dollars that major players develop, a small e-business will have to invest more of its percentage of sales down the line. So, if you are a small business owner like me, and you want to make it in online retail, you need to figure things out and find some good resources.
Since it is impossible to know everything and online selling requires a combination of several web skills, start by creating a network of resources around your project—such as search engine optimization, graphic design, development and marketing—or hire a web agency. Sites such as Agent Solo or Elance can help you quickly find freelancers and consultants for many different projects.
Hard to get economies of scale
With small volumes, it is difficult to negotiate the main costs of e-commerce. If you sell tangible products, your largest expense would most likely be shipping. The VentureOne Program from Canada Post provides member discounts on express shipping and you can not negotiate a better rate until you reach 750 shipments per year. In many sectors, small volume means having to pay basic fees or minimum monthly billing fees.
For an independent online business owner, the day-to-day challenge is to increase sales volumes so as to negotiate better costs for expenses that cannot be cut. To do so, you need to stand out and think outside the box. The advantage of being an independent business is that you can stand out and react swiftly. You need to disseminate your offer and products using the web and seek out low-cost solutions.
There are at least two options that are seldom exploited by small business owners: price comparison websites and affiliation.
In mature markets—which is not yet the case in Canada—a simple e-commerce site is no longer enough for online selling. Pending the arrival of semantic commerce, consumers are now turning towards price comparison sites to search for products. Distributing your catalogue—though not the entire content!—through these types of tools is indispensible to obtain real visibility and attract visitors to your site. Google understood it well and integrates its shopping offer, particularly in the U.S. and France (not yet available in Canada but coming soon!), to its search results. There are a few price comparison sites in Canada. Canada Post has one and checkout is usually done through one click—just like an ad on Google, for example.
An affiliation model can be a bit more complex. The principle of an affiliation is to pay a commission, a percentage of sales made by a business facilitator. Imagine a website that places a banner on its site pointing to your website or even a specific product. You would only pay a commission when the sale is actually made. The concept is interesting but requires the affiliate to trust your website.
There are a variety of external sales tracking solutions. Unfortunately, you usually have to have volumes in the hundreds of thousands of dollars per month range for Google Affiliate Network or Commission Junction, for example. Independent businesses thus have to use free source code solutions or modules such as iDevAffiliate for their stores. In some cases, larger advertisers may require their own tracking code on your website. Even if the affiliation does not bring much more in sales, it is still an excellent way to get better search engine optimization and many more inbound links.
The challenges will be greater for new independent players in the coming years, since Canada is gearing towards a more professional market. This has already been the case in countries such as the U.S. and France for a number of years now. The price of entry will become higher and technical knowledge will be indispensible for success. A good idea alone will not be enough—you will also need a very good grasp of e-commerce!