Why You Should Start an Online Retail Business


You should consider to start an online retail business. Bricks and Mortar (Traditional retailers) are now urgently adding online retail channels to the businesses. Thomas Smale contributing to The Entrepreneur proposed the following reasons:

Achieving economies of scale with an online retail business

Venturing online with a retail business offers a better chance to achieve scale advantages. Online retail businesses are not restricted – unlike Bricks and Mortar retailers that have defined audiences. Therefore they can offer their products to customers around the world. The increased sales because of the internet’s wide reach dilute the unit costs of merchandise resulting in higher profits.

Doing business anywhere at any time

Brick and Mortar retailers are bound to physical stores in demarcated areas.  Online retailers, on the other hand, can do business using only their laptops or mobile devices.  This gives them freedom to explore more opportunities. Equally can the customers of online retailers shop from any location at any time.

Low overheads and high margins

The costs are lower to start and run an online retail business. When starting a Bricks and Mortar retail business, you need a lot of capital for rent deposits, to buy merchandise, hire staff, etc. Retailers that are only doing business online may make use of drop ship suppliers that will carry the merchandise on their behalf. Also, online retailers can also offer a wide range of products in different colors and sizes because they do not have to display them in Brick and Mortar shops.

Access to a world- wide market

The internet has no geographical boundaries and online retailers may therefore target niche markets globally to achieve larger sales. Customers with internet access anywhere in the world can search and purchase your products to have them delivered on their doorsteps.


Retailers that do not add the online channel to their business are closing down. You need to to your business where your customers are. That’s nowadays online and mobile…

A well researched and written Business Plan helps to get your business started the right way.

Read also: South African Retailers Failing Online

Image: Pixabay

Published by

Douw G Steyn

Management consultant, blog writer, dreamer

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