ONLINE BUSINESS START-UP COSTS

via creativeextraordinaire    Discuss    Lifestyle
In my post on how to set up an e-commerce website, I mentioned pricing strategy and the importance of knowing the costs that are attached in selling your product(s) online. Today I am breaking down the costs of starting an online business in order to help you assess the financial viability of your business. Click here to subscribe to my channel These are broken down in five categories and sub-categories within each: 1. PRODUCT COSTS · Product manufacturing costs: cost of design, production, and delivery to the warehouse. · Product purchasing price: from suppliers, delivery to the warehouse. · Product packaging costs: barcoding, labeling and boxes. · Service delivery costs: team member’s time, additional expenses (travel, subsistence), additional support material needed (workbook, manual). · Shipping costs: selecting courier service (negotiation rates), calculating volumetric weight, deciding on shipping offers, etc. · Fulfillment costs: warehouse rent or fulfilment center fee (which is usually calculated per square meter) · Return costs: are you going to incur the cost of return goods or are you going to refund the customer · Payment method costs: use of credit card and currency exchange rates. 2. E-COMMERCE WEBSITE COSTS · Website developer fees for website design · Fees for website customization (CMS or SAAS) · Domain name · Hosting · Secure Sockets Layer (SSL) certificate · Software, plugins and extension fees · Subscription fees · Transaction fees · Software, plugins and extension fees · Customer service fees 3. VIRTUAL MARKETPLACE COSTS · Subscription fee · Listing fee · Transaction fee 4. VISUAL IDENTITY & CONTENT CREATION COSTS · Visual design: logos, typography, color palette, copy, and packaging. · Copywriting: company overview, about us, contact us, and FAQs-draft a frequently asked questions page, translation of core content, product description, translation, photography, and manuals. · Photography: photo library, stock photos, team, and office shots. · Videos: company overview, demos, testimonials, and events. · Legal: terms of conditions, and privacy policies. · Marketing: promotional material- leaflets, and brochure. 5. OTHER COSTS · Compliance process · Accreditation process · Product adaptation costs for new packaging offers, for selling online, and new markets. · Business registration · Overhead: office costs, professional fees, hardware, software, staff, and taxes, etc. It is now time to identify your costs and categorize them, keep an open mind and probably over-budget because you are likely to overspend, there are a lot of unplanned expenses that are too often unforeseen. Check out the workbook here for further reference, I hope it helps you in your financial planning.

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