There are three primary considerations to think about when you sell online: products to sell, a way for online shoppers to find and buy them, and a process for storing goods and shipping orders. This guide explains how to sell online step-by-step and explores ways to combine these elements in an efficient, profitable operation.
The three steps to selling online are to decide what to sell online, set up your online sales channels, and fulfill your orders.
1. Decide What to Sell Online
A key part of learning how to sell online is understanding your product sourcing options. Most online sellers buy goods from wholesalers, but many make their own goods or contract with companies to make goods to their specifications. Plus, you can also sell custom made-to-order products or goods that ship straight from supplier warehouses.
Sell In-Demand Products
“Selling a unique or improved version of an in-demand product is easier and less costly than launching a wholly new concept. Sellers that go this route have less investment tied up in product development and marketing than new product launches and can recoup costs quickly. Small businesses that focus on spotting opportunities for in-demand goods with low competition, and pair that with cost-effective fulfillment, tend to be profitable long-term.”
—Anthony Watson, Senior Director of Client Acquisition, ShipBob
Your Own Products & Services
When selling your own products and services online, you’ll spend time sourcing raw materials to create your product. You can purchase these materials from a manufacturer, or they can manufacture the entire product for you. This typically involves prototyping and working with an engineer to create a finished product. If you already produce goods in your own facility, you have this element covered. You’ll just need to consider cost-effective packaging for shipping your online orders.
You don’t have only to sell physical products, either. You’ll typically have lower overhead when offering an intangible product or service. Digital goods include photos and artwork, website themes, music, and instructional or entertainment podcasts, books, or video files. These digital products can be created and uploaded to an ecommerce-enabled blog or ecommerce platform, then downloaded upon purchase.
Another consideration is to sell things you have lying around your house already. You’ll sell these on marketplaces that allow used goods, such as Mercari and Poshmark. Make sure that your items are cleaned up well before listing the goods for sale.
Someone Else’s Products & Services
Retail buyers’ markets feature a wide range of wholesale goods that you can buy and resell. Reselling ready-made goods tends to be less profitable than selling products you make, but the upfront investment can be far less, plus you can easily rotate goods to keep your collection fresh.
Private label manufacturers use a hybrid approach to selling someone else’s products and services. They make goods but let you put your own label on them. This is the lowest-cost way to build your own brand and is especially popular for beauty, healthcare, cosmetics, and gourmet food startups.
Another hybrid approach is print-on-demand, where you can sell products such as T-shirts, mugs, jewelry, and pillows, all customized with your designs but on someone else’s raw product. Your per-item profits are lower compared to making these items yourself, but setting up a production facility is costly, so that’s the trade-off.
Dropshipping is one of the lowest-cost ways to sell online, aside from selling things you have lying around your house. You don’t need to purchase or stock any goods. When you make a sale, your supplier handles the shipping for you, and only then do you pay the wholesale price for the item. However, your profits are generally lower than the items that you stock and buy yourself.
Another option to think about is becoming an affiliate. An affiliate earns a commission for referring sales, clicks, and leads to merchants. You can join an affiliate marketing program where there’s a vast network of merchants to work with. Otherwise, some merchants have their own in-house affiliate programs, such as those offered by ClickFunnels.
2. Set Up Your Online Sales Channels
Online sales channels are how your buyers find and purchase your products. Most businesses automatically think of launching a website to sell online, but that’s just one of many options. Today’s online sellers have an array of online sales outlets from which to choose.
Consider these sales channels when you sell online:
- Amazon: One of the largest business-to-consumer (B2C) marketplaces in the world, Amazon allows both new and used goods for sale. You can even use their program, Kindle Direct Publishing, to self-publish ebooks, audiobooks, and physical books.
- Facebook Shop: Right from your Facebook business page is where you house a Facebook Shop. Followers and nonfollowers can discover your products and purchase from your store all without leaving the app or your business page from a desktop.
- Facebook Marketplace: The Facebook Marketplace is typically where users sell products they have around the house. It’s similar to an online garage sale.
- Shopping on Instagram: Without ever leaving the Instagram app, a user can discover and purchase your physical products through shoppable Instagram posts. This is whether or not they’re following you thanks to the discover feature within Instagram.
- eBay: One of the oldest online marketplaces, eBay is a popular choice for hard-to-find collector’s items. You can sell both new and used items, auction-style or Buy It Now-style.
- Craigslist: Classified ads allow Craigslist users to buy and sell used goods and services online. This is the best place for local, in-person transactions.
- Etsy: If you make handmade goods, Etsy is one of the best places to sell artisan and handcrafted items. You can also find creative services there, such as web design and digital templates.
- Poshmark: If you’re based in the United States, you can sell new or used clothing, home goods, shoes, and accessories to other users. This is done via their app or through a desktop.
- Mercari: Very similar to Poshmark, Mercari has an app and desktop site to sell your items. However, it has a presence in Japan in addition to the US, and you can sell pretty much anything that can ship. You’re not limited to only clothes, shoes, and accessories, but you can’t sell anything illegal or counterfeit.
- ThredUP: Specifically for secondhand clothes, ThredUP is an online thrift store shoppers paradise. You can send in a bag of your clothes for consignment, or you can get paid upfront at a lower commission on anything they’ll keep to sell.
Consider How You’ll Get Paid to Sell Online
Getting paid is another crucial factor in learning how to sell online, and how you do this also depends on the sales channels you choose. If you sell on your website, social platforms, or an app, you’ll need a way to accept credit card and debit card payments. Ecommerce allows you to sell your products and accept payments globally on many platforms, which includes major marketplaces, social sites, email inboxes, and your own website.
3. Fulfill Your Orders
When selling online, storing products, processing orders, and packing and shipping goods all fall under the term order fulfillment. When considering how to sell online, this functional area deserves attention because fulfillment is a primary expense in online sales and can even surpass your actual product costs.
It’s important not to cut too many corners to lower costs since this can impact the customer experience negatively. Packing mistakes, slow deliveries, and stock shortages due to a mismanaged warehouse all are fulfillment mistakes that can tank your new online business.
Storing goods and shipping products yourself can be time-consuming. However, for startups and small sellers, it can be the most cost-effective solution. Additionally, it can provide a thorough understanding of the process so you can spot issues and areas for improvement as you grow.
Fulfillment companies are what many successful online sellers use to handle order fulfillment tasks. This leaves them free to focus on business-building activities like sales channel expansion and product sourcing. Typically less costly compared to managing a staffed warehouse, it can scale up or down quickly and cost-effectively to meet increases or drops in sales.
This option lets you sell products without buying any stock upfront. Dropship suppliers inventory goods and handle all fulfillment needs for you. Only when you make a sale does your supplier charge you for the goods sold. This selling and fulfillment method carries lower profit margins, but the trade-off is practically no upfront or ongoing investment.
Mixing the three fulfillment methods listed above can provide the most cost-effective solution for a busy online business. Managing fulfillment this way lets you store and ship products at optimal costs, be that in-house or outsourced, and use dropshipping to expand your product line without further investment.
How to Market Your Online Store
When you’ve listed your products and services for sale, you’ll need to promote them to prospective customers. You can do this through many different methods, such as purchasing online ads, asking for referrals, and running contests. Many online store owners use a combination of any number of these methods.
Consider marketing your online store using the following strategies:
- Ads: Popular places to run ads for products and services include Facebook, Instagram, and Pinterest. You can usually get traction for around $5 per day in ad spend.
- Referrals: Some store owners offer a refund of half the order price when they refer five friends who spend at least a certain dollar amount. You’ll need to configure what numbers will keep you profitable.
- Contests: A contest is a popular way to get viral exposure. Encourage users to tag their friends on social media for contest entries. Avoid requiring them to follow or share the content since that’s typically against terms of service for most social media platforms.
- Influencers: Collaborate with influencers who have an engaged following in exchange for a discount or a free product. You can also give an affiliate link to the influencer, so they’ll earn a small percentage of any referred sales. Most sellers offer 10 percent of profits to affiliate marketers.
- Live video: Social media users love to see behind-the-scenes of a company. This lets them know there are real, relatable people working to make great products and services. Customers are more likely to purchase from companies they know, like, and trust.
- Customer content: Encourage your customers to publicly post them using your product or service for the chance of getting mentioned on social media. You can also offer a small incentive, such as free shipping or 10 percent off, for sharing publicly.
How to Sell Online Frequently Asked Questions (FAQs)
This section includes the most frequently asked questions about how to sell online. If you don’t see your question, head over to our Fit Small Business forum, and post your question there. We have a whole team of industry experts who answer questions from small businesses every day.
Is it profitable to flip products?
Your ability to make a profit from flipping products, whether new or used, depends on many different factors. These factors include the product’s condition, the market you’re in, the demand for the product, and how much it will take to rehab the product, so it’s sellable.
Where can I sell online for free?
Popular places to sell online for free include Facebook Marketplace and Craigslist. You can also sell your used products through apps such as Decluttr and OfferUp.
Which is the best platform to sell stuff?
The best platform to use to sell products and services depends on what you’re selling. Artisan and handcrafted items do well on Etsy, which is a marketplace built explicitly for creative products. On the other hand, apparel does well on an Instagram Shop. Hard-to-find items and antiques sell well on eBay.
Bottom Line—How to Sell Online
It’s easy to get started whether you want to sell online to get rid of things you have around the house, or you’re looking to start a full-fledged online store. You’ve learned which platforms you can sell your products and services on, how to start for free, and ways to leverage social media. For the most effective way to sell online, you’ll want to create an ecommerce store.
If you decide you want to create an online store to sell your products and services, check out BigCommerce. They’re one of the best ecommerce platforms and website builder in one. You’ll get mobile-friendly themes and an easy-to-use dashboard. You can also use it to list products, manage inventory, and process payments securely. Start your free 14-day trial today.