Why Do Most E-commerce Businesses Fail ?

Why Do Most E-commerce Businesses Fail ?

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We see myriads of new businesses spurring in the online arena every single day. Still as much as 80% of all the ecommerce websites fail to make their mark in the market. It is not that the business was faulty or there wasn’t anything unique about them; most of the times they just ignore some very important points to run an ecommerce site successfully and become the victims of failure. However, you can avoid these pitfalls by abiding by these tips.


Lack of Any Real Investment

It is true that you can start an e-commerce website with only a few thousand rupees but then it not enough to sustain and increase your business. For any business to function you need some capital and a considerable labor too. You should see it as a business opening up a new branch in a location. This will of course need investment in terms of your time and money.

Lack of Cash Flow

If an entrepreneur invests all his capital in stocking up goods in his inventory and do not keep aside any capital for marketing etc. purposes then the sales would not increase and the business will also risk of becoming stagnant. To avoid this scenario opt for paying for inventory on monthly, bi-monthly and tri-monthly basis.

Poor Handling of Inventory

It is quite a risky area for ecommerce especially for those who are just start-ups. Bulking on too much of inventory while can risk low or no cash flow as mentioned above; having a too low inventory can lead to disappointed customers and losing on sales. You need to keep in mind that different vendors will have at different times to deliver you your order so you will need to reorder accordingly. Also, take care of freight cost.

High Competition

While online market is a great opportunity for any new business to flourish, it is also fully capable of diminishing its chance of growth in the light of already established and strong competitors. You thus, need to find your niche and sell those products to the customers which are unique; instead of trying to sell a mass market product which is already available to them from more popular vendors.

Poor Website

Even if you have a great business you cannot imagine it to do good if your ecommerce site is not up to the mark. Your site needs to load fast, must be mobile devices adaptable, must have good functionality, be secure and have a great search facility.

Bad Product Images

Of course a product’s description and functionality is important but so is its image. It is so because what you have described in your product description must be clearly visible in the picture as well since it is the only way the customer will be able to get acquainted with the product he has to buy.

Low Website Traffic

If your site doesn’t have enough traffic it will clearly reflect in your sales as well. A sure shot way to get good traffic is through pay-per-click advertising; though, other cheaper but effective ways are through good content writing, social media awareness and advertising and merchandising of the product on-site.

Lack of Patience

It is the saddest of the reasons of all the causes of downfall of an online business. You need to have patience to see the profit growing. It takes time to make good sales and grow business.

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Pranav, 23, is a Full Time Freelance Writer, residing in the capital city of the Country. He has been cited as one of the youngest Blogger cum Content Writer from the state by the National Daily Hindustan Times. He has also contributed a short story to the Anthology, Phase Unknown Women-A Tribute. His next short story is slated to be released with Penguin India later this year. He is involved with varied online sites for varied types of writing.

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