The idea of generating a passive income is something that many people are interested in. After all, who wouldn’t want the chance to earn money for essentially doing nothing? Most people would take the opportunity if it were presented to them. Yet the important thing to note about passive income is that although it might not take a lot of effort once it is established, getting it to the point wherein you can actually make a reasonable amount of money will take time and effort and may well be a lot of hard work. Once this is done, however, as long as you have chosen the right business, you should be able to make a reasonable passive income.
There are many different ways to create a passive income such as becoming a landlord or owning but not running a business, but one of the best – mainly because there is little risk and plenty of reward when done right – is setting up an eCommerce business. This is essentially the act of selling products online, and as you will know through your own spending habits, online shopping is incredibly popular.
Read on to find out how to generate a passive income through eCommerce and with little effort. It might not all be plain sailing, but hopefully you’ll think it’s worth doing.
Choose The Right Products
Choosing the right products for your eCommerce store might seem like the most obvious thing of all, but it is also the most important – or at least as important as other items on our list – and must be carefully considered. You might want to start an online bookshop, for example, but is this really a good idea? While the product itself is a popular one, the market in this area is over-saturated already. If you add your eCommerce store to the mix, is it ever really going to stand out?
So rather than choosing a product that many other websites are selling, it’s far better to choose something unique. Yet this can also be problematic. If you pick something that no one has ever heard of, you’re going to need to spend a lot more time and money on your marketing to show people what it is you do.
Once you have determined what you want to sell, do some market research to make sure that people are interested. Not only will this give you an idea of the size of your potential market, but it will also help you work out who your target market is, thus making marketing a much easier prospect too.
Build Your Website
Having something to sell that you know will be popular and that you know already has a market is a good start, but unless you have a platform to sell it from, no one will be able to buy it. With this in mind, it’s time to build your website.
Your site should not be a complicated one, so keeping it as simple as possible is a great way to entice people to stay on it browsing your products for much longer. With a simple navigation system and an easy-to-use online store, as well as plenty of content to give users a much more personal experience, people will be happy to use your site.
Once you have your site up and running, you’ll need to run checks on it to ensure that people are visiting. There are various ways to ensure your site is doing what you want it to do, so take a look at the Basic Guide to Core Web Vitals 2021 to understand more about what you should be looking for.
Choose A Platform
Of course, you don’t have to have a website to sell your products from. Or rather, you don’t have to have your own website. If you prefer to use a bigger name to springboard from, there are options available to you. Many sellers choose to use eBay or Amazon, for example. They will pick their platform, upload their products to it, and simply send items out when they receive an order.
The benefit of this is that the platforms are already highly used and trusted, and these well-established businesses can be the ideal place to find customers for minimal effort. However, there are negatives to using these platforms as well. One problem is the cost. You’ll need to pay a percentage of every item sold to the platform before you can take your cut, meaning your profits will be much lower. Not only that, but there is a lot of competition on these sites, and it might be harder to be noticed.
This is why it’s so important to choose the right option for you – either website or eCommerce platform – at the start. When you can do this, your business will run much more smoothly, offering you the ideal passive income.
Choose A Delivery Provider
Selling the items in your eCommerce store is certainly a passive thing to do, but sending them out to the buyer will require you to do something. Namely, you’ll need to package the product up and arrange for a delivery to be made (unless your business is one that you dropship, of course). It’s crucial that you pick a good delivery provider at this point. If you don’t, it won’t matter how user-friendly your website is, what fabulous prices you can sell at, or how innovative and unique your products are, because the delivery is the last impression any buyer will have of your eCommerce business. If this is unsatisfactory in any way, you might not get the repeat business you’re hoping for.
Price is certainly going to be a factor, and although ‘going cheap’ isn’t always a good idea in business, you should make sure you’re not paying too much either – especially if you’re passing these costs onto your customer.
Reviews are always helpful too. Read a mix of good and bad and see what the issues are as well as what people are praising the courier or delivery company for. In this way, you can see what is going to work best for you and your business.