Advantages and Disadvantages of Setting Up an Online Business

Feb 19
08:43

2009

jefferson john babasa

jefferson john babasa

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Among of the growing trends in business today is E-Commerce. Electronic commerce, commonly known as e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily since the spread of the Internet.

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Why do businesses go online? There are a lot of reasons why businesses go online,Advantages and Disadvantages of Setting Up an Online Business Articles such as wholesale clothing businesses. Several advantages has been cited why this is occuring, some of those advantages are:

·         In an online business such as an online clothing shop or an online wholesale clothing shop, you could receive a larger profit margin than a brick and mortar one. Unlike a brick and mortar business, online businesses such as an online clothing shop won’t necessarily require a middle man in its business process. This in-turn will generate more profit than those of a brick and mortar one.

·         You’ll have better control on your pricing. By removing the middle man, you’ll be having better control on the flow of your pricing. Allowing you to negotiate and offer more discounts than your competition.

·         Lower price tags than those of a brick and mortar clothing shop. This in-turn will attract more customers to visit your site and buy your products.

·         Offer your products on a larger market. Unlike the brick and mortar clothing shop, online clothing shops can target its market on a larger scale. By use of some successful internet marketing strategy, this could provide your business with global recognition.

·         Location is not required in an online business. Unlike a brick and mortar clothing shop where success depends greatly on its locations, online clothing shops would only need to set up a website. This could save you time to do some studies on your stock than interviewing and observing the traffic of people in your location.

·         Setting up an online clothing shop is cheaper than buying or renting a place for your clothing store. If you have some knowledge in setting up an online business, then you won’t have to hire yourself a team of web developers.


But other than advantages, there are also some disadvantages of setting up an online business like an online wholesale clothing business. Some of these disadvantages are as follows:

·         You’ll have no control on where you sell your products. It could be from some place that you’ve never heard of.

·         Lack of knowledge in E-commerce could leave you susceptible from scams, hacks, and viruses.

·         Extra cost when your customers are countries away from you. Cost on shipment is very expensive, especially if you’re only transporting only a couple of products to your customers.

·         It could cause you to loose your focus on managing your store accounts (if you have any). This is because online shops are needed to be maintained on a daily basis. Also, glitches and bugs within the system could cause you more trouble and more expenses.