I Decided to Sell Physical Products, What Now?

physical-products

I decided to sell physical products, what now

If you decided to sell physical products online then this article will be a good guide to look for a type of product to sell.

Practically you have 4 choices for this and you can select any or a combination of these. I only discuss the ones where the customers you have stays yours and you need to do your own marketing process. What I mean by this is for example Amazon considers the buyers to be their customers so you are not allowed to further market to them in any way. On the other hand the below 4 method allows you to collect contact information and further market directly to those customers.

    1. Sell your own products
    2. Purchase the product in bulk for a discounted price
    3. Purchase the product individually
    4. POD, Print On Demand products

Let us examine each one and see what they mean and what the pros and cons are.

Sell your own products

We touched on this in a previous article and we have seen some of the requirements. Can be a very profitable system but only if you have your own product or products.

Pros:

  • You promote your own brand
  • You have control over the shipping
  • You have control over the quality of the product

Cons:

  • You take care of the manufacturing. You or your company is doing it or you contract it out.
  • You need to manage the stock
  • You need to take care of the shipping logistics
  • The first two requires a large up front expense
  • You have to be extremely sure that the product you are offering will sell, which means you have done the market research

Purchase the product in bulk for a discounted price

If this is setup correctly and a good supplier is found then this could be one of the most profitable system.

Pros:

  • You can have your own brand on the product
  • Can be custom packaged to your requirement to support your own brand
  • The highest profits can be made with these products due to bulk purchase savings, hence higher profit margins are possible.
  • You control shipping, hence the processing time can be as short as one day which makes customers happy since they will get their products 5-6 days earlier.

Cons:

  • Large upfront costs, since purchase has to be made in bulk
  • You have limited quality control
  • Lengthy setup with manufacturer to finalize custom branding and packaging. Need to get actual samples. You wan to make sure that the supplier does a proper branding customization following your requirement and not just slaps on a sticker with your brand name and info on it, but once the sticker is removed all original branding show up. That would only reveal to your customers that the product is not actually yours.
  • Lengthy postage because they usually ship in containers since it is bulk purchase and travel by sea.
  • With these products 5% of the total shipment can be expected as loss due to bad handling damages or other damages.
  • Due to all the processing and shipping times from the manufacturer or seller, by the time the product arrive it might be outdated for your customers and the once ‘hot’ product may not sell and you get stuck with it. This has happened before and it is not good to get stuck with a container full of goods that do not sell.
  • Possible language barriers with suppliers or manufacturers as these are usually sourced from China.

Purchase the product individually

This is a common way of selling physical products online because it has a relatively easy process with low starting cost which favours this type of online business for beginners. This is what is called dropsipping.

Pros:

  • You do not spend money on the product up front
  • You only pay for the product after the customer purchased it from you
  • Do not have shipping logistics, the supplier will take care of that
  • With the correct software application and marketing platform the order process can be relatively easy

Cons:

  • With larger number of daily order the order from the same supplier is better handled with a csv file that is sent to the supplier and even the application supported order process can be tedious. Some suppliers do not want to process orders from csv, spreadsheet, files. You need to make sure from the start that those suppliers can process csv based orders. This is only important if one of the products is selling in larger quantities. Tedious processes can be also solved with a VA, virtual assistant that can be hired for a relatively low hourly fee, example $5-6 an hour.
  • Quality is very hard to control.
  • Processing time for shipping is out of your control.
  • Possible communication problems with supplier due to language barriers.
  • Usually the shipping is from China

POD, Print On Demand products

POD products are another type of dropshipping. This means that you provide the design for a product such as shoe, tote bag, wall art, wallet, phone case, T-shirt, bedding set, jewellery, mugs, hats, leggings, and the list goes on, and they manufacture the product with your design on it and send it to your customer. As you can see there are a lot of products now that can become unique to your store.

Pros:

  • You can create your own branding
  • With these products your store can be very unique as the designs are specific to your store
  • You do not spend money on the product up front
  • You only pay for the product after the customer purchased it from you
  • Do not have shipping logistics, the supplier will take care of that
  • Order process is automated using the supplier software built into your online store application software
  • POD company is owned by leading countries
  • Some manufacturing is within the US, hence shipping is very fast
  • Quality issues can be addressed fast and most manufacturers offer replacement with no cost to you or your customers.

Cons:

  • Some manufacturing facility is outside of the US and may incur the same lengthy shipping times as the regular dropsipping, look at their shipping time estimates.
  • Some manufacturer/suppliers charge a monthly fee for their service and the application software that is used on your store. Some even can take some percentage from your sales so look at the particular POD company what they offer but this later is not common.
  • Need to get lots of designs to find a winning product and need to keep adding to the selection
  • Need to hire a designer unless you can do it yourself
  • The particular POD company may not support your chosen shopping platform.

What Did You Think?

Share your thoughts in the comments! Thanks for reading.

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