Focus on products:7 questions to ask yourself before picking products

Whether you are at the start of your ecommerce journey or deciding to expand your product offering you need to think hard before settling on which products to sell. There are millions of choices out there but which ones are right for you?

This is one of the decisions that will make or break your business – it’s not just a case of finding something that you like – there are many other considerations which should be taken into account. What you sell directly influences so many other parts of your business including branding, pricing, marketing and target audience.

Here are a few questions to ask yourself before you make a decision:

What size is the market?

If you are going to offer a product, you need to understand what the potential demand is going to be. Who is the product targeted at? You want to find something niche but too niche might not give you enough sales.

A good way of working out what the demand might be like is using Google’s Keyword Tool. This will tell you the volume of people searching for your product and its associated keywords and from that you should get an idea of the market size.

Who are you up against?

It’s important to understand how much competition you have for the product you want to sell. If there is a demand for a product and not many retailers offering it then you could be on to a real winner.

If there are already a lot of retailers offering that product you need to think about whether the market is already saturated. Otherwise you could consider what you could do to offer the product in a different way and persuade shoppers that they should buy this product from you. For example you could offer free online tutorials on how to use the product or discounts on related products.

How easy is it going to be to get hold of the product?

Once you have decided on a product you need to find a supplier. How trustworthy is the supplier – remember, you are essentially going into business with this person and need to make sure they are legit. Are there multiple suppliers? It is good to know what if one supplier doesn’t work out – you can continue to offer the product through someone else.

If the product is coming from far away, how difficult will it be to maintain stock levels? Will it take two months to get new stock when you run out?

What will your mark-up be?

You know how much you can buy it for but what price do you think you can sell it for? Products that don’t offer a decent mark-up are best left alone, especially if you are importing them and bringing them long distances. You never know what kind of hidden costs you might incur when selling the product so you want to make sure there’s room for that.

Find out what the same or similar products are being retailed at in your market. This will give you a good indication of what people are going to pay for something.

Is the product seasonal or simply a trend?

You may have established a demand for the product but is this likely to last? Ideally you want a product that will have consistent demand. Google Trends is a great product for understanding fluctuations in demand. If there has been a spike in demand which is on the way down, this might be a fad that you’ve missed the boat on and best avoid.

There can be money to make in seasonal products but you need to understand the likely demand curve so you can plan accordingly. The same is true of trends, they can sell very well in the short term but you need to be aware that they might not continue to sell well for years to come.

How much does it weigh and how big is it?

Customers don’t like to have to pay for shipping in most cases. By choosing large, heavy objects you are making it less likely to be able to offer free or even cheap shipping. Not only will these products cost your customers but they will also cost you if you are getting them from abroad or in fact keeping them in a third-party warehouse.

Will you have to deal with any restrictions or regulations?

Certain products come with regulations. This can be the case if you are selling at home and an even more complicated case if you are planning to sell abroad. If you are looking at a children’s toy for example, does it meet the safety standards at home or in the different countries you intend to sell in?

Do some research and make plenty of calls to customs to find out the regulatory information you need.