Advantages and Disadvantages of E-commerce
Advantages:
- - Lower overhead expenses: Many small e-commerce businesses can be operated by a solo entrepreneur, which means you likely won’t need to hire employees until you have sufficient revenue and sales to justify hiring someone. You also won’t need to face the cost of operating a brick-and-mortar store. You won’t need to lease property or face any of the numerous costs that come with operating a physical store.
- - 24/7 selling opportunities: E-commerce businesses are open as long as the internet doesn’t crash, since you don’t need to be available every time someone makes a purchase.
- - Customer data collection and customer targeting capabilities: You’ll have access to customer data. You should be able to track customer buying habits and send out automated and customized emails encouraging future purchases. Targeting previous customers with carefully selected marketing messages can increase sales.
Disadvantages:
- No customer in-store experience: This may be especially valuable to customers who want to try out a product or ask questions about different products.
- Delivery: Many e-commerce businesses offer next-day delivery, and Amazon offers some customers same-day delivery. However, a one-person e-commerce store can’t usually ship items to customers as quickly. To increase your shipping speeds, try to have your products ready to ship ahead of time.
- Technology and security: You could be locked out of your systems or data if you don’t have sufficient protections in place. You’ll also need to ensure that attackers aren’t stealing credit card information or personal data from your customers. If your customers don’t trust your site, you won’t be able to sell them products in the future.
Reference:
- Nolan, P. (2022) Advantages and disadvantages of e-commerce businesses, The Balance. The Balance. Available at: https://www.thebalancemoney.com/ecommerce-pros-and-cons-1141609 (Accessed: January 20, 2023).
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