Some entrepreneurs are excited at the prospect of making millions of naira in e-commerce, but few are truly prepared for the harsh realities they will face in their endeavors.
In this blog post, Seliigate shares seven harsh realities in e-commerce in Nigeria and the solutions for mitigating them.
7 Harsh Realities About E-Commerce (and How to Escape Them)
1. Logistics can be Tiresome
Logistics is the soul of e-commerce businesses, But it can make or break your e-commerce business. Delayed shipments, lost packages, and unreliable delivery agents can frustrate customers and damage your reputation. This is where a reliable logistics partner like Selligate comes in.
How to avoid this: By replacing logistic companies with distributors from Selligate, you can ensure that your products are delivered on time and in good condition. This will not only enhance customer satisfaction but also reduce the stress and heartache that come with handling logistics on your own or through impatient logistics companies.
2. It Largely Depends on Ads
Advertising is the lifeline of your e-commerce business. Whether you’re using Facebook, Google, or Instagram, your success heavily depends on paid ads. However, this reliance can become a significant vulnerability. If your advertising account is banned or your ads stop performing, your business can come to a painful halt.
How to avoid this: To mitigate this risk, diversify your marketing strategies. Invest in SEO, content marketing, and email campaigns to reduce your dependence on paid ads. This way, if one channel fails, others can continue to drive traffic and sales.
3. Selling Branded Products Puts You at Great Risk
While selling branded products can be lucrative, it also puts you at risk of violating intellectual property rights. If a brand decides to take action against you, you could lose your social media pages, face legal challenges, and ultimately see your business crumble.
How to avoid this: Ensure that you have the proper authorization to sell branded products or focus on developing your unique products. Building your brand not only protects you from legal risks but also gives you more control over your business’s future.
4. The Industry Is Not Regulated
The e-commerce industry is a double-edged sword; its lack of regulation makes it accessible to anyone with the financial means to start a business. While this low barrier to entry is appealing, it also means the market is flooded with competitors, some of whom may not adhere to ethical standards. This can lead to a challenging environment where trust and quality control are constant battles.
How to avoid this: To avoid falling into the pitfalls of this unregulated landscape, focus on building a reputable brand, providing excellent customer service, and ensuring that your business practices are transparent and ethical.
5. Some Customers Will Almost Drive You Crazy
Dealing with customers can be one of the most challenging aspects of e-commerce. From rejected items to flimsy excuses at the point of delivery, some customers can test your patience and make you question your sanity.
How to avoid this: To avoid burnout, it’s essential to set clear return policies, streamline your customer service processes, and maintain a professional demeanor. Remember, not every sale is worth the headache, and sometimes it’s better to let a difficult customer go than to expend all your energy trying to please them.
6. You Need to Build a Team
E-commerce may start as a side hustle, but to scale and sustain it, you need to build a proper structure. Running an e-commerce business is not a one-person job. You’ll need a team to handle various aspects of the business, from customer service to logistics to marketing. Building a solid team allows you to focus on strategic growth while ensuring that the day-to-day operations run smoothly.
How to avoid this: Keep your emotions aside, and approach your business with a clear, professional mindset to build a team that will help you succeed.
7. E-Commerce Entrepreneurs Go Broke Fast
The e-commerce industry is fast-paced, and if you’re not careful, you can quickly find yourself in financial trouble. Many entrepreneurs make the mistake of reinvesting all their profits back into the business without setting aside savings or diversifying their income streams.
How to avoid this: To avoid going broke, it’s crucial to manage your finances wisely. Save a portion of your profits, diversify your investments, and know when to scale back. By being financially prudent, you can ensure that your business remains sustainable in the long term.
In conclusion, while e-commerce offers incredible opportunities, it also comes with its fair share of challenges. By understanding these bitter truths and taking proactive steps to avoid them, you can build a resilient, successful e-commerce business.