In recent times we have seen the closure of Toys-R-Us, Woolworths, Blockbuster and many more from the rise of companies like Amazon, Netflix and other disrupters. In 2020, we can expect to see the closure of stores worldwide from companies such as Gap, Abercrombie & Fitch, Victoria Secret and Forever 21. WHY? E-Commerce!
E-commerce (electronic commerce) is a transaction of goods and services over the internet.
E-commerce has dramatically changed the way people view buying and selling goods and services. We can all go online, compare prices, checkout and get it shipped to our front door within a day — all without leaving the house. Moreover, with smartphones and the internet, wherever you go, you can shop through apps and stores wherever you are.
Examples of E-Commerce Successful Disruption
Uber is the largest taxi company in the world, WITH NO CARS! Is it Uber’s fault for taxi companies failing, or is it the taxi companies fault for not keeping up with the times?
In 2017, Airbnb has more available rooms than the top five major hotel chains combined. All of this without actually owning any of them! With over four million listings worldwide, Airbnb has managed to disrupt the way that most people look at the accommodation when travelling.
Netflix has over 158 million paid memberships in over 190 countries. However, when Blockbuster had the chance to buy this service for $50 million, they were laughed out of the room. Now, Netflix is worth over $125 billion, and Blockbuster failed.
Now we see a considerable rise in digital banking services such as Monzo, Revolut, Starling Bank and many more. These companies have no physical banking space and operate solely through an app on your phone. We can see the impact on traditional banks as they now have an app; you can bank online and have many new features. However, this has lead to the closure of many retail banks. Finextra says that “over a third of UK bank branches closed in the past five years.”
What are the advantages of setting up an E-Commerce Company?
Here are 7 advantages of setting up an E-Commerce Company
1. Lower costs
With no physical office space required when setting up an E-Commerce company, no labour costs (until you need help with expanding your business), no or very little equipment such as tills, signs and so on. Running an E-Commerce company can cost a little as a couple of hundred Euros per month.
2. Great customer experience
Customers have a simple shopping experience by having everything at their fingertips. Customers can search, compare and buy products all through one site without running into issues. Also, with free chat boxes available to download, if the customer has a question, you can still interact with them.
3. Potential 24/7 income stream
Physical stores are only open typically from 9 am to 9 pm, and some close over the holidays. However, with an E-Commerce business, you can run it 24 hours a day, 7 days a week, 365 days a year. You could be sitting on a beach in Tahiti and still be making money.
4. International market
With advances in global shipping and logistics, you can deliver goods and services all over the world in short notice. In contrast, if you have a physical store, you’re only visible to customers in that area.
With an E-Commerce business, you can increase and decrease your workload with the click of a mouse. You choose the products and services you sell, the advertising budget, the hours you work. Having an E-Commerce business can be a part-time job or a full-time career.
6. Simple marketing strategy
Social media has never been more significant in E-Commerce. You can advertise your product or service FOR FREE to the whole world. Obviously, you can pay for advertising to reach more eyes. However, organic growth is also possible through content writing, blogging and creative thinking.
7. Easy to start-up
Setting up an E-Commerce business is typically an administrative job.
Step 1: Research your target market
Step 2: Find your vendors
Step 3: Design your business (logos, website, social media…)
When you’re ready to start trading
Step 4: Register your business
Step 5: Obtain a licence (if applicable)
Step 6: Obtain a Tax ID
Step 7: Register for VAT
Step 8: Get a PE (permission to employ) number
Step 9: Data Protection Registration
For more information on how you can set up an E-Commerce business in Malta, you can download our free PDF or contact us for more details.