4 eCom Business Models That Any Beginner Can Start

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Deciding to start a business is an exciting prospect!

The ability to set your own schedule, make your own money and be your own boss…there are so many great perks.

With starting a business, though, comes some major decisions. A couple of the most important choices you’ll need to make upfront is what kind of business you want to start—and where you’ll source your products.

There are a few different ways that products are produced, and each business owner that is selling physical goods needs to decide where their products are coming from.  

Below are the top 4 eCom business models that are available (and their advantages)…

1. Drop Shipping

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Drop shipping is extremely popular among beginner online business owners because it makes it extremely easy to get the production side of a business up and running.

Here are a few of the advantages of drop shipping…

1. No Inventory To Stock

If you are unfamiliar with drop shipping, here is essentially how it works…

A business owner creates a website and finds products that can be sold through their website that is fulfilled by a drop shipper.

The customer visits the website of the business owner and purchases the products. From there, the drop shipper fulfills the orders.

Pretty cool, right?

With drop shipping, there is no inventory to stock. This means no need to spend money on a warehouse or shipping costs.

2. No Need To Produce A Product

Not everyone is a producer, and that’s okay. You don’t need to be an artist or a clothing designer to sell art or clothing…

With drop shipping, the business owner chooses between products that have already been designed and manufactured. All the business owner needs to do is connect the customer with the product through their website.

3. Low Cost Of Entry

Because there are no manufacturing, design or shipping costs, the overhead for a drop shipping company is actually pretty low.

This low cost of entry makes it easy for just about anyone to start a drop shipping business!

(Note: Want to learn more about setting up a successful eCom business? Check out our free course, eCom Millionaire 101, with expert Dan Dasilva.)

2. Outsourced Manufacturing

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Do you have a great idea for a product that you know people will love? If so, outsourced manufacturing may be for you!

Unless a business owner is selling per product (which we will get to in a moment), it’s necessary to have some form of manufacturing to create products.

Outsourcing is one of the best ways to have products manufactured without having to actually own a factory to produce those products.

Here is why you’ll want to consider outsourced manufacturing…

1. Quality Control

When you are drop shipping, you're really putting a lot of trust in the manufacturers for the company that is producing and fulfilling the product. You don’t have any control over what factory the company fulfilling the orders is using to manufacture their goods.

When you outsource manufacturing yourself, you can pick which manufacturer you think would be best for your goods.

2. Lower Costs

When manufacturing your own goods in bulk, you can actually save a lot of money on costs. Cutting out the middle-man can really be a money saver!

3. Pride In Your Product

There is nothing quite like the sense of pride that you get from seeing something that you had a part in designing being sold to and used by consumers.

While drop shipping and wholesale purchasing is a bit easier, it doesn’t come with the sense of pride that can only come from creating something that is truly unique and your own.

3. Self-Made

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Speaking of producing something from scratch, another product model that involves a lot of creativity is self-made products. These are the kinds of things that you’ll find on sites like Etsy, along with creator-owned websites.

Self-made products include things like: soap, jewelry, custom clothing and so on. These are things that take time to craft and are often made by hand.

So, why go with a self-made product?

1. Allows For The Most Creativity

When you make something from hand, you really have complete control over what that thing ends up looking, smelling and feeling like.

Even if a piece of art or jewelry is commissioned, there are certain creative decisions that the producer is more than likely allowed to make. After all—that’s why the patron picked that creator specifically.

If you are any form of creator or artist, self-made may be the way to go (at least until you can mass-produce).

2. Very Low Cost Of Entry

Self-producing original products is probably the lowest cost of entry. This is because there is little-to-no middleman.

Instead, the creator is simply responsible for the costs of production, shipping and a web presence.

3. Ability To Control Production

With someone else producing a product, the ability to control that production can slip away a bit.

When creating everything by hand and from scratch, there is a 100% ability to control production of your goods.

4. Wholesale Purchase

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When you visit many stores (especially online stores), you’ll find that you have a selection of different goods from different producers. Unless these goods are being drop shipped, they are likely being purchased wholesale.

When a company buys something wholesale, they buy it in bulk. They then sell it to the consumer at a higher price than what they bought it for.

Here are the advantages of wholesale purchasing…

1. Lower Prices For Goods

When a company buys in bulk, they save money. It’s as simple as that!

Manufacturers often prefer to not sell one unit at a time. Instead, they want to sell bulk to wholesalers that can then turn around and sell it to their customers.

By buying in bulk, you are saving money.

2. Selling An Established Brand

Producing goods isn’t enough to sell those goods. Instead, a brand image needs to be created.

By purchasing from a wholesaler, you are able to purchase products from established brands. This allows you to save money on building up a brand.

3. No Production Costs

When buying wholesale, you are purchasing a product as-is. This means the product has already reached the end of its production cycle.

Once a wholesale batch gets to you, everything in that order is ready to be sold. You can literally pull those items out of the box and immediately sell them to customers!

Choosing Between eCom Business Models

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The right product model for YOU will depend on a variety of factors. You’ll need to consider things like:

  • Your budget
  • Your creativity

  • Your branding and marketing abilities

  • And more

Take some time to consider each, and figure out which would be right for you.

From there you can get your business going and start making money!

(Note: Want to learn more about setting up a successful eCom business? Check out our free course, eCom Millionaire 101, with expert Dan Dasilva.)