This article would explain to you how to start an online furniture business by understanding what are the challenges faced.
1. What are the challenges faced while starting an online business
Starting a furniture business online can pose a few critical challenges – owing to the niche segment of this business. Let us try to identify them:
· Understand your Target Audience and know where the demand is?
- Right at the beginning, we need to define our Segmenting – Targeting – and Positioning.
- Segmenting is the process of classifying consumers within a particular market.
- Targeting is identifying which of these classified segments is the most suitable to venture into depending upon our key strength and niche.
- Finally, Positioning is how we orient or “position” the business in this targeted segment in the customer’s mind to be more attractive and lucrative.
- Example segments could be premium, mid economy, and economy. A study of demand and need in the market can help us understand the right segment to target
· Customer complaints can destroy your brand’s online image
o We live in a digital world of communication now and one nature about this is that it is transparent. Thus, online furniture/Sofa businesses need to be wary about this. Any poor review (be it service or quality) can be severely detrimental to the business.
· Not understanding the “numbers/financials” is not understanding your business
o Before you venture into an online furniture business or Sofa business or furniture rental business you must get your numbers in place. The major investment in digital marketing. A sales projection for the next 5 years should be made with a breakeven analysis to understand the basics of the business.
· Launching without a “Niche” is a plan towards bankruptcy
o This digital world is an equal playing ground for all. That is competition can come out from any corner. It is not only new players but existing giant players also that are present. To overcome these hurdles, we need to define our niche – that is we need to define a specialized segment of the market for a particular kind of product or service. That niche may be something like customizable furniture, multi-utility furniture, specializing only in Sofas or specializing only in Dining tables, etc.
2. What are the pointers where one needs some expert help in building a sustainable online furniture business?
Market research is decisive to understand the demand pockets and which segments to target. Market research helps us understand
· Competition (who are they, what do they offer (products, services, pricing, etc)
· Feasibility Study (understanding the sales numbers, the break-even point)
· Risk and Mitigation (identifying factors that pose an imminent threat in the present and mitigating the likelihood of them happening)
Ecommerce Business Operations
Apart from the regular required operational aspects, there are some aspects critical to an online furniture store
· Inventory – the real-time inventory needs to be reflected on the portal to avoid dissatisfied customers.
· Last Mile delivery –ensuring correct and timely delivery to the consumer’s location.
· Order fulfillment – from picking to packing and finally to dispatch
· Customer care management – issue or query resolution. In a digital faceless world, this forms a decisive step in leading a customer to a purchase.
· Returns management – Having policies and procedures surrounding returns need to be detailed to avoid dissatisfied customers.
Online Business Plan
A furniture online business plan is like a frame of reference. With an online business plan, you would decode
· What is the investment required in the business?
· What is the breakeven point of the business
· What is the return of investment and return on capital of the business
Online Business Strategy
In simple terms Strategy means a set of actions devised to achieve a long-term goal. Thus, it is
· Validating the business model and risks
· Defining major departments
· IT structure, framework, and policy
· The operational strategy – that is from the
o order placement
o last-mile delivery
In the furniture space of business, apart from understanding fast-moving goods, every procurement needs logical reasoning – as it directly impacts the storage, handling, and damages costs.
We should grow organically. For an online furniture business, a full in-house team is not needed. A major chunk of work is in the warehouse – for which 3rd party freelance agencies could be used. A mix of in-house and temporary freelance workforce is the key to forming a non-capital-intensive initial setup. Only when the proof of concept is tested that once could grow inorganically.
Reviews, Complaints & Return Management
Reviews and complaints need immediate resolution. They form the base of your happy customers and repeat customers. They also act as promoters for your business. Thus, if there is any return the backend team needs to be adept in managing and resolving the issues and ensure if a return needs to be taken, that it is done smoothly.
Online Business Launch Support
Various areas are needed to be tested before the launch like
· Website integration with your backend software/application
· Order fulfillment to last-mile delivery is happening or not
· Overall experience is smooth and in sync at all points
YRC comes with all the necessary experience of having built online furniture businesses and helped them evolve as a brand.