Thread by @mywifequit

eCommerce is Predicted to have 2.14 billion Global Buyers by the End of the Year

Are you still looking to get into E-com?

Here are 8 E-com Business models that will save you time and money

//THREAD//

The E-com model you choose comes down to one thing:

Risk vs Reward

Models can be:

>Easy to start but hard to profit
>Hard to start but can be extremely profitable

This thread rates each model based on the:

1) Profit velocity
2) Ease of launch
3) Level of competition
4) Sustainability and risk

Learn how to make the right decision in this thread:

1) Dropshipping With Your Website

How it works:

1. Contact wholesaler to get approved as retailer
2. Build your website that lists products
3. Build traffic sources to the website
4. Send orders to wholesalers for fulfilment

Pros
>Easy to start
>No fulfilment
>No inventory
>Low startup cost

Cons
>Less pricing flexibility
>Vendors can be unreliable
>Paid ads difficult with the low-profit margins
>Your business reputation relies heavily on vendors
> Customer support is difficult depending on 3rd party

Dropshipping ratings:

>Profit velocity: 3/10
>Ease of launch: 8/10
>Level of competition: 3/10
>Sustainability and risk: 6/10

2) eBay and Amazon Arbitrage

How it works:

1) Resell Amazons on eBay for higher
2) Copy + Paste images and product description onto eBay
3) Resell on eBay at a higher price
4) When the auction finishes on eBay, buy the product on Amazon and ship it to the buyer

Pros:

>$0 overhead
>No website needed
>No vendors needed

Cons:

>Hate from brand owners
>Risk of being banned
>Always trying to find arbitrage opportunities

eBay and Amazon Arbitrage ratings:

>Profit velocity: 2/10
>Ease of launch: 10/10
>Level of competition: 2/10
>Sustainability and risk: 1/10

3) Retail Arbitrage

How it works:

1. Buy low-cost merch at clearance outlets
2. Sell at a higher price on Amazon FBA

Pros:

>No website
>Low startup costs except for the cost of inventory
>Leverage the size of Amazons Marketplace

Cons:

>Very hard to scale
>Rely 100% on Amazon
>Amazon discourage this model
>A large amount of time product hunting

Retail Arbitrage ratings:

Profit velocity: 5/10
Ease of launch: 8/10
Level of competition: 5/10
Sustainability and risk: 2/10

4) Dropshipping on Amazon

How it works:

1. Find distributors who’ll drop ship for you
2. List them on Amazon as merchant fulfilled
3. Contact distributors to ship products for each sale

Pros:

>No website
>Startup cost of $0
>100s of products ready to list

Cons:

>Strict Amazon requirements
>People can contact the same distributor as you to copy
>High risk of getting banned (Guy lost a 7 figure biz with this)

Dropshipping on Amazon ratings:

Profit velocity: 7/10
Ease of launch: 8/10
Level of competition: 3/10
Sustainability and risk: 1/10

5) Private Label Amazon Selling

Private label lets you place your own brand on a product you manufacture

How it works:

1. Find manufacturers that white labels
2. Produce the products in bulk
3. List on Amazon FBA

Pros:

>No website
>High margins
>No inventory issues
>No driven traffic needed

Cons:

>People can copy you
>Not ideal for a beginner
>Relying on Amazon FBA
>Large upfront cost as you have to produce products in bulk

Selling private label on Amazon ratings:

Profit velocity: 10/10
Ease of launch: 6/10
Level of competition: 8/10
Sustainability and risk: 7/10

6) Selling Wholesale on Amazon

How it works:

-Find distributors who have a large product catalogue
-Buy the products and list them on Amazon FBA

Pros:

>High margins
>Fast turnarounds
>Low unit quantities
>100s of products at your disposal

Cons:

>You’re selling the same product as other sellers
>The price will eventually erode as you’re listing the same products as others

Selling Wholesale on Amazon ratings:

Profit velocity: 7/10
Ease of launch: 7/10
Level of competition: 3/10
Sustainability and risk: 3/10

7) Selling Wholesale on Your Website

How it works:

1. Find a wholesaler
2. Build a website and sell
3. Manage your inventory

Pros:
>You have control of your brand

Cons:
>Not easy to manage the brand

Selling Wholesale On Your Website Ratings:

Profit velocity: 4/10
Ease of launch: 5/10
Level of competition: 5/10
Sustainability and risk: 6/10

8) Selling Private Label With Your Website

How it works:

-Build your product
-Build your website
-Drive traffic to your website and product

Pros:

-The best long term potential
-You have control of everything

Cons:

-High upfront investment
-Hardest model to manage

Selling Private Label with your Website rating:

Profit velocity: 7/10
Ease of launch: 4/10
Level of competition: 9/10
Sustainability and risk: 1-/10

To wrap this thread up:

There isn’t a “best e-com model”

Every model has its own pros and cons

It all depends on your personal risk and reward tolerance.

Thanks for reading through the thread!

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