There are so many people going out on their own in business. They have found something that they want to do and realised that it can be done entirely online – they have then stepped out on their own to provide their services in their own business.
Usually, people who operate their own business online have some kind of digital expertise. For example people with skills in web design and development are able to offer these services, as their overall ‘product’ is not physical but digital. As a result, digital channels are favourable for this – in fact, they are ideally suited.
But doesn’t that exclude a whole range of businesses that don’t operate in a digital sense? People who make products that are physical, no matter how small or big, should still be able to operate their own business online in a similar sort of way. The problem with making physical products is that it takes a lot of energy and manpower.
This means that, unlike the web developer holed up in their bedroom, there is usually added expense involved for people wishing to sell products online. One expense is staff. Staff are required to assemble the products, and it can be a significant expense if there is a significant demand for the product itself. However, it’s possible that a business will buy their products wholesale and then sell them on – which mitigates the expense of staff.
Even if that is the case, there are numerous other expenses that one can run into. For example, there are a lot of storage needs for physical products. Unlike digital storage, which keeps getting smaller and providing more and more space, physical space is at an absolute premium. The cost of warehousing is very high, especially for a small business. In addition, renting a warehouse can mean wasted money during times when demand is reduced – such as in the case of seasonal products.
However, it is possible to utilise an outsourced warehousing company that uses a shared model – meaning that expenses are reduced. Storage aside, there is still the issue of distribution of these physical products. Whereas the web developer ensconced in his room will have the ability to simply email his products with zero costs – shipping and handling can be expensive, not to mention a logistical nightmare.
The amount of time it takes to fulfil these orders is also a concern, most small business owners don’t want to waste their time focussing on things that aren’t at the core of their business goals or interests. One solution is hiring a member of staff, which will incur a considerable expense. Another solution is outsourcing logistics in a similar way to outsourcing warehousing. In fact, it could possibly be the same provider.
Outsourcing means that all shipping and handling, as well as storage, is outsourced. Leaving you to focus on the core values of your business.