The basic online store

Is it easy to have your own online store?

Yes, nowadays there are many options therefor. Some of them are free and only charge you if there is a sale, while others offer a trial period with the possibility of retracting the contract and not paying anything if you change your mind. There are three options to consider:

1. To choose a pre-existing online store and take your products there.

2. To have your own online store in a rented space, outsourcing the logistics (i.e. payments, shipping, warehousing, etc.) so that you can devote yourself entirely to the products to be sold.

3. And, finally, to manage the infrastructure and services of your online stores. It is even possible to manage the logistics involved in shipping, payments and other services such as the after-sales one.

Of course, most of the time, these three options are combined among themselves. The first and second ones are those mainly used, since nowadays it is very difficult to find an online store that handles everything with the in-house staff. Let’s start from the simplest to the most complex cases:

Option 1: Using an existing online store to sell your products

This is the case with Mercado Libre, Amazon, eBay, Alibaba and others that have appeared recently, such as Falabella.

In other words, the online store already exists and covers the infrastructure, logistics, communication, advertising, collections and customer loyalty. In this case, as a seller, the only thing you have to do is to upload the products info and take care of a minimum customer service to answer questions. But, virtually, you can fully devote yourself to produce what you want to sell.

This is a good option but, on the other side, it causes several problems. First of all, it works like a supermarket or a bazaar. Your products compete with those next to them, they don’t stand out or, in order to make them stand out, it is necessary to pay an additional cost. Advertising is concerned with attracting customers to the online store, but not specifically to your product.

If you want your own online store, option 1 is not suitable. This is where everything becomes more interesting and, at the same time, more complex. Option 2 is the most used alternative, but there are different combinations. To understand a little more about it, first you must be aware that, in order to have an online store, three elements are needed:

· A name.
· A hosting.
· A software to sell with.

This name, in the case of the Internet, is called “domain” and should represent the trademark. For example: Zara.com, patagonia-ar.com, etc. The domain is as important as the trademark. Both require a registration; both are paid for and in both not all options pretended are available.

The registration of the domain (or trademark, as mentioned above) is a fundamental process that cannot be avoided. It is important to pay attention to it. Choosing a good name for the domain is as important as choosing a good name for the trademark. As far as possible, they should be the same. If you want to give your trademark the name of “Macy[S1] “ (because you are called “Macy”), it is impossible because the trademark “Macy” has already been registered. Besides, it is most likely that being “Macy” such a common trademark name, a domain with the same name already exists.

Registration is the only task that should never be outsourced; you can hire a marketing company to think of a good name but its registration should be a personal mission. This way, you will never lose it. Likewise, if the investment is very big and a company must be created therefor, registration should be in the name of the company.

Both physical and online stores need a physical space in which to be located. The cloud, or the Internet, is nothing more than a network of computers connected to each other. Therefore, an online store needs a small place in a computer that is connected to the Internet and available 24 hours a day, 365 days a year. This is called a “hosting” space.

Thirdly, you need a software to sell your products with. This software is what turns a simple website into an online store. It works as a showcase, a counter and a warehouse, and allows you to charge for the products and keep track of what you are doing.

Renting a space and creating an online store require an initial investment and time. Sometimes, this is not possible. Therefore, there are companies that provide the online store immediately, on a turnkey basis, for a minimum monthly payment.

These companies offer the following:

· A hosting service, that is, a rented space to locate the online store.

· The software to sell with, configured with different means for payment and even shipping.

While your work consists of:
· Choosing the look of the online store among different templates.
· Uploading the info corresponding to the products to be sold.
· Configuring your data (billing, collection account and other features).

This type of online store has become very popular in recent times because it allows the seller to start selling immediately and solves several problems: taking the hosting service, creating the online store, implementing the security, performing the maintenance work and installing the updates. The investment at the beginning is much lower, since for a minimum monthly cost you can already start working. Some companies even offer a trial period to see if the client is satisfied with the online store look before sales can be launched.

The best-known companies are Shopify and Tienda Nube, although Mercado Shops, WIX and Mi Negocio Personal (from the Personal company) that has recently appeared, can also be mentioned.

In general, all of them offer almost the same: they propose different plans that provide more storage and special benefits in the highest plans. The user does not realize at first glance that he/she is logging into a Mercado Libre’s, Tienda Nube’s or Shopify’s account. For the user, it is an individual website, an online store different from others, each one in its own domain; that is, with its own trademark name or URL.

SHOPIFY details
Monthly rate: USD 29, 79 or 299
Rate per purchase: 2.9 % + USD 30¢ / 2.6 % + USD 30¢ / 2.4 % + USD 30¢

TIENDA NUBE details
Monthly rate: ARS 799 / 1999 / 6999
Cost per transaction: 2% / 1% / 0.5%

MERCADO SHOPS details
Monthly rate: No fixed monthly costs and unlimited posts
Cost per transaction: 10% / 26%

The greatest benefit from these turnkey online stores is that it is possible to set up a basic online store, upload the products info and start selling, even if the seller has no knowledge therefor. However, it is important for the seller to reserve some time for configurations since, no matter how simple they may be, they take time. So, it is always crucial, depending on your business plan, to ask for extra help to be more successful and perform faster. In Portinos, there is a large community of graphic designers and web developers available for this type of online stores, who speed up the uploading and configuration tasks and adjust the design to improve the product.

As said above, this option is ideal when a small volume of sales is handled and a relatively small online store is required. The advantages are that these companies take care of the hosting, offer a software that adapts to all devices and provide technical support for any contingency that may arise. However, as time goes by or when sales volumes increase, there is no longer profitability in the business and the seller loses a lot of freedom of decision.

In addition to the monthly rate, there is a commission for sales and then a commission for collections; that is, the commission charged by credit cards or the commission charged by Mercado Pago, PayPal or whatever. And still you have to add the administrative or logistics costs (shipping, for example).

Therefore, when the business is no more profitable, option 2 can be modified and another type of combination can be tried. As said above, this option is very versatile. For this reason, it has been the most widely adopted.

*The brands and photographs appearing in this article are owned by third parties and are shown solely for reference purposes. All rights reserved to their respective authors.