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Starting an E-commerce business is no walk in the park. As a new entrepreneur, you must take on the challenging feat of deciding what business model you will follow. This will dictate your store’s future performance, profit, and growth. That being said, choosing one of the E-commerce business models can be overwhelming, especially for those who have limited experience in the industry. 

In this guide, we’ll break down everything you need to know about different business models so you can choose the best one for your E-commerce store.

What Is a Business Model?

A business model is a company’s plan to make a profit. It identifies the services and products a company wants to sell, its target market, and other expected expenses. In short, a business model refers to the company’s foundation and strategy on how to be profitable.

Business models are extremely important, especially for new businesses that want to grow steadily, as well as established businesses that want to scale.

A good business model not only helps with sales. It also does wonders in getting top-notch talent and lucrative investments. Furthermore, it also aids in motivating staff and management.

It’s worth noting that your business is not tied to the first business model you choose. As you expand, you can regularly update this to ensure it keeps up with trends and potential challenges.

Best E-Commerce Business Models in the Philippines

Here are some E-commerce business models you can follow if you’re looking to open your own online store.

B2C

Business-to-consumer is one of the most common types of business models in the E-commerce realm. Retailers follow the B2C model.

For this model, a business sells services or products to end users, not to manufacturers, or other businesses.

It’s worth noting that this business model is easy to start because your target market can be huge. That said, you should be prepared to deal with a massive amount of customers which can also mean constantly dealing with returns, complaints, and other issues.

Another challenge you may face with this business model is attracting new customers since it’s highly competitive. You’ll be dealing not only with local competition, but also established brands from around the world.

B2B

Business to Business E-commerce involves selling to other businesses. Whatever you are selling, whether it may be computers, uniforms, furniture, or food, your main target should be other businesses.

Many businesses that follow this model are also manufacturers who sell their products at wholesale prices to other businesses, such as retail stores.

One of the best things about this E-commerce business model is it has a huge potential for growth considering businesses buy in bulk and place massive orders compared to the B2C model. This means that every sale can be extremely profitable.

While it’s easy to get repeat customers when it comes to this model, expect fewer sales volume. There’s also a learning curve when it comes to this business model, especially if you have no existing business network or background in how businesses operate.

C2C

If you’ve bought from an E-commerce platform before such as Shopee, Lazada, Carousell, or Facebook Marketplace, then you’re already familiar with this model.

Consumer to Consumer business models involve sellers listing products they already have or sourced from other retailers. Also called Peer to Peer E-commerce, this model usually involves working with a platform that helps connect sellers to customers.

C2B

For this business model, companies heavily rely on consumers to not only use their products but also to give them value.

For instance, YouTube places ads on the videos of creators, and both parties generate profit from it. This business model is also widely used in affiliate marketing, where a brand enlists a person of influence to promote its product/s. If someone purchases a product through their link, the influencer gets a commission from the sale, and the business also makes money from it. Therefore, it’s a win/win situation.

Dropshipping

Dropshipping is growing increasingly popular among E-commerce entrepreneurs. With this business model, a retailer does not need to hold any inventory for the products they sell. The supplier ships it directly to the customer.

Dropshipping is a low-maintenance business model since the seller doesn’t deal directly with order fulfillment. However, since this model is not direct, you may find it hard to build your brand’s reputation. There’s also a huge risk of losing money if your supplier goes out of business.

Private Label

If you want to start a store that generates a lot of sales, then you should consider the private label business model. This model allows brands to sell their unique products made by a supplier. The supplier’s name will not be on the label. They will only be involved in the production process. As a business owner, you will decide what you want to sell, how it will look, its price, and other aspects.

White Label

If the last business model sounds like a good idea, but you don’t have the resources to create your own product from scratch, then you can try the white-label business model instead. 

For this model, a supplier gives retailers pre-made products. The supplier focuses on the product production while the retailer is in charge of selling and marketing it. One supplier can have a few retailers selling the same white-label product.

With this model, you can have access to other brands’ designs without investing much money in product development. For example, if you’re selling clothing, you can choose to use other brands’ designs but put your own label on them.

Your main job is to promote, handle the marketing, and ship the product. As long as you work with reputable brands, this model can be very profitable.

Wholesale

In Wholesale E-commerce, businesses focus on serving other retailers and customers who buy in bulk. This business model usually comes with a Minimum Order Quantity or MOQ.

When it comes to this model, you should consider scalability. The more retailers buy your products, the more revenue you will generate. However, it comes with more responsibilities and higher risks.

Subscription

Another E-commerce model that’s gaining popularity is the subscription model. When you sell subscriptions, you’re selling products and services on a regular basis to a customer. This means you’ll get a steady stream of profit.

For instance, if you own an organic food business, you could have a subscription package where a customer gets a weekly delivery of organic fruits and vegetables.

Some of the biggest companies in today’s world follow the subscription model. This can be seen in the tech industry as well. The most notable examples are companies like Netflix and Spotify. There are also companies that offer monthly subscriptions for magazines or books.

On-Demand Manufacturing (ie: Print-on-Demand)

Want to sell products before they are made? The best way to do it is by using the on-demand manufacturing business model.

This business model reduces the inventory costs businesses usually have to deal with. On-demand manufacturing allows businesses to make or print books, designs, photos, t-shirts, and other products right after an order is placed.

On-demand manufacturing is much more cost-efficient because it allows you to only produce what you need when you need it. If you’re an entrepreneur who can’t afford the upfront cost of inventory, make sure to consider this model.

Tips for Choosing the Best E-commerce Business Model

Still not sure which of these E-commerce business models to follow? We’ve compiled some useful tips for you below.

Decide if you want to cater to customers or businesses

The first thing you need to ask yourself is whether you want to focus on serving individual customers or businesses. This crucial decision will let you narrow down your options for your e-commerce business model.

Want to start a business that serves individual customers? You should consider business models like drop shipping, C2C, or private label. Want to sell to businesses? Your focus should be on wholesale or B2B.

Get to know your target market more

Knowing more about the target market is vital when it comes to deciding on your business model. You should not only know their demographic information but also their buying behavior. For instance, how often are they buying stuff online? Do they need your products or services often?

Decide whether or not you want to keep inventory

Once you have decided to whom you want to sell to, you need to figure out if you want to hold inventory.

If you have a big budget, then it would be a good idea to keep inventory since it eliminates the risks and added costs of constantly purchasing products from suppliers. However, you will deal with a lot of expenses like rent, which could be extremely draining especially if you’re self-funding your business.

Before choosing to not keep inventory, you should also consider the shipping and order fulfillment time of your suppliers. 

If your suppliers can produce or ship products fast, not holding inventory may be a better choice. By following business models like drop shipping, you can focus more on customer service.

Assess how much control you want to have over your product development

Are you the kind of person who can design unique and marketable products? If you are, then you can go with the private label business model. 

This way, you can have full control over your products and the image of your business. You will also have more freedom when it comes to making a profit.

But if your budget does not permit this, don’t worry. You can still follow the white-label business model where you simply re-brand other people’s designs or products.

Consider what you’re selling

Your business model of choice varies depending on what you are selling.

If you’re selling physical products, then follow business models like dropping shipping, white labeling, or wholesale. E-commerce stores that sell physical products usually have more choices.

If you’re selling digital products, then you can follow business models like C2C. Businesses that want to sell services can follow various models as well, although they typically do best in B2B, C2C, C2C, and Subscription.

Take your strengths and weaknesses into account

Business models are also dependent on your strengths and weaknesses. For instance, if you have an expansive business network, then you can do B2B or wholesale. 

If you excel at creating things from scratch, private labeling will be perfect for you.

Understand your brand positioning

Before choosing a business model for your e-commerce business, you need to be clear about your brand positioning. This refers to how your business will be perceived by your target market.

Brand positioning is essential in determining your business model because different business models often have different brand positions.

You need to be able to showcase your business and products/services in a way that you can stand out from the crowd. 

Having a powerful brand image that is aligned with your business model is the ultimate way to make people interested in your business and your products.

For instance, if you follow the B2B business model, having a corporate image will do wonders for you. 

Meanwhile, if you follow the B2C business model and your target market is Gen Zers, then approaching things in a fun, friendly, and engaging way will give you an advantage.

Think about your plans for scalability

By thinking about scalability early on, you’ll be able to better determine what kind of business model to follow.

For instance, some E-commerce businesses like drop shipping are more easily scalable than others. 

Private labeling is also good for scalability because entrepreneurs usually want to expand their product line, although it involves more work when it comes to product development.

Consider your budget

It’s important to know your financial limits and only choose business models that are within your means. 

Keep in mind that it’s easy to lose control of your business and go broke if you manage your E-commerce store poorly.

If you don’t have much cash to start with, consider choosing a business model that won’t require you to keep a lot of inventory, like drop shipping or on-demand manufacturing, is recommended.

These are just some of the things that you should know about the different E-commerce business models. Once you know which model you want to go with, it’ll be easier to determine the other aspects of your business.

If you’re looking for a reliable E-commerce partner to help you with the nitty gritty of your business, you should choose Payo!

As your reliable partner, we’ll provide you with various E-commerce solutions — from Live Customer Support and Fulfillment to Cash on Delivery Integration and Advanced Remittance.

Sign up with us today or send us a message at [email protected]. We look forward to helping you thrive in E-commerce!

In the Philippines, the E-commerce market is currently valued at a whopping $15.62 billion, and it is expected to skyrocket to $29.54 billion by 2027.

This shows how undeniable the dramatic shift to E-commerce has been. New businesses flocked to the digital space, and brick-and-mortar shops did the same. That being said, it’s now integral to incorporate online selling into your business.

Thankfully, starting your own E-commerce business has never been easier, faster, and more affordable. 

If you’re thinking about how to start an E-commerce business and you’re not sure where to start, this article will be your new best friend.

We’ll walk you through everything you need to know about it – from its advantages and disadvantages, the best E-commerce platform for you, and how to work on your delivery and logistics management, among other things.

What is E-commerce?

Electronic commerce, often abbreviated as E-commerce, is a process where businesses trade goods and services over the internet. 

E-commerce allows your business to reach millions of customers without much effort. By adopting an E-commerce strategy, you’ll have a virtual global store that generates sales and profits with the click of a button.

Without question, E-commerce is truly an incredible selling strategy for start-ups since it allows them to reach their target market at a lower cost. 

A lot of businesses in the Philippines have shifted to E-commerce because it’s a more convenient and cheaper way to sell products. 

By having an E-commerce store, you can also efficiently manage your inventory and streamline your delivery easier through the help of third-party ecommerce services like Payo.

Pros & Cons of Starting an E-commerce Business

Before you start your own E-commerce business, it’s important to know its advantages and disadvantages. Here are a few: 

Pros

Low costs

When you start an E-commerce business, it usually does not require a large budget. 

You can start small, and go for free platforms such as Facebook Marketplace, or you can set up your own website for a fraction of the cost compared to building your brick-and-mortar store. 

Location is not an issue

One of the best things about selling online is that you can sell your products and services to customers from anywhere in the world. There’s no need to worry about the proximity of your business/warehouse to your customers.

It is easy to showcase products

With E-commerce businesses, you just need to invest in good product photos and videos. You can even include customer-generated media and reviews on your website to encourage more people to buy your items. 

It is easy to target customers

Thanks to E-commerce, your business can reach millions of potential customers easily, wherever they are located. 

This can be done by using the right keywords and descriptions. It’s not like brick-and-mortar stores whose customers are limited to people within your business vicinity. You can also use advertisements and social media posts to widen your customer reach.

It offers great potential income

E-commerce businesses give you better chances to generate more income compared to a brick-and-mortar store because it costs less to maintain an online business. 

Scaling your business is easy

Scaling your business is very straightforward when it comes to E-commerce since you can easily add new products to your inventory, and increase your sales and profits by using better marketing and advertising strategies.

You can sell 24/7

One of the benefits of ecommerce is that you, your partners, and your customers can take orders 24/7, 365 days a year. 

If your customers want to take advantage of the convenience and flexibility E-commerce provides, they can do that any time they want.

Cons

There is no in-store experience

For certain customers, it’s not just about the products they want to buy; it’s also about the experience they get from shopping in a physical store. By shopping online, they won’t be able to touch or feel the product, which can be a deal-breaker for some people.

It is dependent on the internet

For your customers to access your E-commerce platform, they need an internet connection. If the internet is down, your customers will not be able to view or buy your products or services. However, now that most people are connected to the internet, this seldomly becomes an issue.

No one can buy if your site crashes

If your E-commerce site crashes or malfunctions, you won’t be able to serve any customers. This can be problematic, especially during peak sale periods.

It is very competitive

Since there are millions of E-commerce businesses out there, it can be challenging to stand out. This is why you have to take time to get to know your competitors, and establish what’s unique about your business, and work on getting your brand out there.

There may be potential privacy and security issues

Although E-commerce websites are now safer than ever, there may still be issues on safety and security. Someone may be able to hack into your database and steal the personal and financial information from your customers. You might not get this information back, and if it gets out, your reputation may become irreparable.

Avoid this problem by investing in the security of your platforms. 

Types of E-commerce Business Models

Now, let’s look at the different types of E-commerce business models. Keep in mind that you can fall into more than one of these categories.

Business to Consumer or B2C

For this business model, you sell directly to end users. For instance, if you buy in an online store as a customer, it means they are following this model. 

This is an amazing business model to follow for low-cost products and services. 

Business to Business or B2B

This type of model involves businesses selling their services or products to another business. 

Usually, the buyer is the end-user, but they typically sell it to their consumers as well. This business model has a high order value, but a longer sales cycle. 

Business to Business to Consumer or B2B2C

For this model, companies sell their services and products in partnership with another organization to a customer. 

This is not the same as white labeling where companies rebrand an item as their own. For this model, the consumer understands that the product they are buying is from an original company. 

Business to Government or B2G

This business model involves businesses selling their goods or services to government entities, whether it’s a municipality, city, the national government, or a specific government agency. 

This business model involves a bidding process.

Consumer to Business or C2B

This model enables individuals to sell services and goods to companies. For this model, sites may enable customers to post their work and have businesses bid for it. 

Direct to Consumer or D2C

Direct-to-consumer is another popular business model in the ecommerce industry. 

For this model, products are sold directly to end customers without any help from third-party wholesalers or retailers. 

Consumer to Consumer or C2C

This model usually happens in online marketplaces that connect consumers to each other. 

Best E-commerce Platforms in the Philippines

Once you pick the E-commerce business model you want, it’s time to pick your selling platform. As the E-commerce business in the Philippines continues to thrive, more and more platforms have become available to online sellers.

Your choice ultimately depends on factors like your target audience, budget, and your timeline in setting up your store. Here are some of your options.

Related: Best E-commerce Platforms in the Philippines

Self-hosted website

Self-hosted websites give you the ultimate customization and flexibility. By starting from scratch, you can be totally in control of its design and upkeep. 

While this may not be the perfect platform for beginners, you can simply hire web developers to take care of the site building for you. Once it’s running, you can be in charge of the maintenance.

Social media platforms

Nowadays, many social media platforms have integrated shops as part of their service. Facebook and Tiktok are two of the top E-commerce social media platforms today. 

Because it has millions of users, you can promote your products or services to a large audience. Most social media platforms also support live selling which is great for businesses that want to push their digital presence.

Online marketplaces

Almost every person who shops online is active on online marketplaces like Lazada and Shopee. 

These platforms allow business owners like you to leverage built-in platform features and services to ensure your business reaches its maximum potential. With a huge customer base, online marketplaces are also a convenient way to reach out to a large target audience. 

Despite the high competition, there’s still a chance for you to get your share of the pie.

E-commerce Website Builders

If you want to build your website but you don’t have the budget to hire a developer, this is the ultimate choice for you.

E-commerce website builders are designed to easily create a new website with as little technical knowledge as possible. 

Most of these platforms feature drag-and-drop editors, and you may also add various plug-ins to make your customer experience more seamless. Shopify, Wix, and WooCommerce are some of the most popular examples entrepreneurs love. 

How to Start an E-commerce Business in the Philippines 

You may feel overwhelmed once you start an E-commerce business, especially if you’re new to the industry. To help guide you in your journey, we’ve compiled a step-by-step guide for you to follow.

Step 1: Choosing a product/niche

This step will dictate the performance and outcome of your E-commerce business, so make sure not to rush this process.

Think of a niche that you can consistently sell and that has a demand in the market all year round. 

You may choose broad niches like fashion, food, healthcare, or furniture, or stick to specific ones like mountaineering gear, surf suits, limited edition shoes, or blackout curtains – the sky’s the limit. Don’t be afraid to get creative.

Without narrowing down your products to a niche, you will have a hard time building a loyal customer base. Having a niche will ensure your consumers will trust you and think of you as an industry leader. 

Therefore, you will have a higher chance of getting to the top of the value chain. Not only that, but it will also avoid confusion.

Step 2: Market research

Solid market research is needed to know exactly what you’re up against. To help you with this, perform a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis by answering the following questions – who’s your competition? What are their strengths and weaknesses? What will you be doing that’s different from your competitors?

You may also do a customer survey to know what exactly your customers will like, as well as their preferred price points. 

When your business has a clear focus, you can easily differentiate yourself from your competitors. This step will also determine your company’s value proposition and brand positioning.

Step 3: Setting up the business

Since you’ve already decided on a niche, it’s now time to start building your E-commerce business. Create a logo and a comprehensive business plan to make sure everything is organized. 

Once you’ve done this, register your business name to make it official. Here’s an extensive guide on starting a business in the Philippines that you can also check out.

Step 4: Setting up & optimizing sales channels 

Now that your business has begun, you may start setting up your E-commerce store. However, don’t expect to get sales the moment you launch your store. 

You still need to optimize your sales channels to make your products easily accessible and visible to your audience. 

But how exactly can you do this? 

First, you need to create a compelling offer for your audience. Let your customers know how your product can make their life easier. Without this key information, your customers will have no reason to buy your product.

Second, learn how to use SEO to rank higher in search engines. This will help make your products more visible and easier to find on Google and your platform of choice. 

Third, you also need to establish a solid social media presence. Post your products on social media platforms and online marketplaces. This step can help you significantly drive your sales to the next level.

Fourth, optimize your ecommerce store or your listings from online marketplaces for maximum performance. 

Step 5: Choosing the best Payment Gateways

Nowadays, customers expect you to make purchasing easier for them. This is why having a wide array of payment gateways is a must to accommodate different customers’ needs. 

You need to make it easier for them to pay through bank transfer, GCash, Grabpay, Cash on Delivery, PayMaya, and other platforms. 

Step 6: Delivery & Logistics Management

Some of the most important tasks of a business owner is to make sure your inventory is safe, and that your customers get their orders as soon as possible. 

While these tasks may seem easy in theory, these are very demanding and time-consuming.

To make this easier, you need to pick a logistics partner that’s not just reliable and reputable, but also efficient. Otherwise, you will be losing a lot of money as a result of delayed deliveries.

Here’s what you need to take care of when it comes to delivery and logistics management: 

Order fulfillment services

Packing orders is no easy feat, especially if you’re serving hundreds of customers per week. 

Order fulfillment services involve receiving, processing, and delivering orders to customers. This can be done by you, or a third party. 

Warehousing

Product storage is another major thing you need to take care of. You need to have a warehouse that’s highly secure to avoid theft and damage. 

Aside from that, the warehouse should also be clean and well-organized. 

Live Customer Support (Sales Retention)

Customer support is a highly underrated yet vital aspect of running a business in the digital age. 

With good customer support, your customers will be acknowledged daily, and be assured that you’re listening to their concerns – this will also make them more likely to come back to you.

Cash on Delivery Integration

Cash on delivery is one of the most convenient ways for customers to pay for the products they’ve ordered. It’s also a highly popular method for Filipinos, especially for those who do not have bank accounts.

To make cash on delivery a possibility, you’ll need to have a logistics partner that can effectively and promptly deliver your orders.

Parcel Tracking

With a reliable logistics partner, your customers can track orders anytime they please. This will greatly help get rid of delivery anxiety and drive customer satisfaction. 

Tracking also helps business owners to ensure that orders are delivered on time. 

Step 7: E-commerce Marketing

While you might have a great product and a reliable logistics partner, you still need effective marketing methods to drive sales. 

There are plenty of ways to promote your products online, but each has its advantages and disadvantages.

For instance, content marketing is a method of advertising that involves creating blogs, posts, videos, and webinars that are relevant to your audience. 

When your customers see, read, or watch these, your products will be introduced to them and they will generate interest in your brand.

Another effective strategy you can try is email marketing which involves sending targeted emails to your customers. This will allow you to establish a genuine connection with your customers.

Tips for when you start an E-commerce Business in the Philippines

With everything discussed above, it’s obvious that you need to consider a lot of factors before you start an E-commerce business. You have to take care of various aspects before, during, and after the actual business process. To make the process easier, follow the tips below. 

Don’t rush your planning process

Getting your business off the ground may seem exciting, but rushing your planning process will only cause more problems in the future.

Begin by clarifying your goals and objectives for your business. From here, create a comprehensive business plan. If you skip this step, you might end up with a business venture that won’t last for long.

Be in multiple sales channels if needed

While you can market your products solely on your website and Google ads, you might need to leverage other sales channels to have better exposure. 

For instance, you can set up your Facebook and Instagram pages, and be active on TikTok Shop, Shopee, and Lazada. 

This may seem time-consuming, but it will bring you a lot of benefits. That said, it’s always best to prioritize your online presence in platforms where your target customers are most active.

Determine your USP early 

Your unique selling point (USP) should be one of the first things you should establish before you officially launch your online store. 

This will help you position your business better and get ahead of your competition. You can come up with your USP by asking yourself the following questions:

• Why should customers come to your online store instead of your competitors?
• Why should customers buy from you if you were both selling the same product at the same price?
• Why should your customers pay for the items they have ordered?
• How do you differentiate yourself from your competitors?

Understanding your USP is vital for your business venture. For instance, if your products are sold at a lower price than other competitors, you can use this as your USP.

Open a corporate bank account

Setting up a corporate bank account for your business can be confusing, especially for first-time business owners. 

However, this step is non-negotiable, especially if you want to take care of your business finances well. If you mix your personal and business funds, you may end up mishandling your money. 

Create some buzz before launching

Your store will only be successful if you have enough people supporting you. To do this, you can start by creating social media pages to gain awareness. 

Don’t forget to ask for support from your friends and family, and let them know you’re opening an online store so they can share it with their network. 

If you want to go the extra mile, utilize the power of PR by getting your story about the store’s launch published in different publications and online magazines.

Simplify the checkout process for your customers 

The majority of customers leave websites when they encounter issues during the checkout process. 

To prevent this from happening, you need to have a smooth and uncomplicated process for your customers to purchase your products. After all, you don’t want to lose sales, right?

You can use available tools to simplify your checkout process. For instance, you can use Shopify’s One Step Checkout feature. 

Always give top-tier customer service

Customer service is one of the most important things to consider once you start an E-commerce business. If your customers feel that you have given them the best experience, you will greatly increase your chances of making repeat orders.

Be sure to keep your customers updated on the status of their orders, and once the order arrives, send them a personal message to make them feel important. If you receive a message on your email or social media pages, reply as soon as you can. 

To give your customer service a boost, you can consider hiring a staff to handle the various customer requests. This will free up your time from handling queries and allow you to focus on running your business.

Consider tapping influencers or brand ambassadors

Reaching out to influencers or brand ambassadors is not only a great way to reach a wider audience, but it can also boost your brand and encourage engagement. 

Most influencers will charge you for a promotion, but there are also ones that are okay with x-deals and affiliate commissions. Whether you have the funds to pay influencers or not, make sure to treat them professionally. 

Always have a short and long-term vision 

It’s easy to get carried away with excitement once your online store is making money, but you should always have a long-term vision for your business. 

You don’t want to put too much effort in the beginning and then forget about your online store a couple of months after.

Having both long and short-term goals will help you determine where you want to go with your business. 

For instance, your goal for the next 6 months may be to increase your sales by 20%. In the next year, you may want to double your current inventory.  

While it’s okay to be ambitious, you always need to bring your feet back to the ground and be realistic in your goals.

Use failures as a learning experience 

While it’s easy to get frustrated and want to give up, you should always use your mistakes as an opportunity to improve your business. For instance, if your items are damaged during the shipping process, maybe you can change your courier or protect your product better. 

Incentivize repeat customers

As a business owner, you want to keep your customers happy so they will keep coming back to your store.

But how can you do this? By offering incentives that are exclusive to repeat customers. 

Think about what your customers will find extra value in, and create a loyalty program that can make them excited about returning.

Keep your store mobile-friendly

A high number of customers use their mobile phones to search online for items. If your online store is not mobile-friendly, it can be difficult for you to close these potential sales.

With that in mind, you should work on improving the mobile experience of your online store, especially if your target market is young people.

Research tools and services to make managing your store easier

You should always tap into available research tools to help you better manage your store. 

For instance, you can use Google Analytics to see how customers are interacting with your website and to find out which pages have the most traffic so you can focus more on them if necessary.

You may also leverage services like Payo to take charge of logistics so you can better focus on how you can improve your business further. 

E-commerce Business FAQs

Still got questions about E-commerce? We’ll answer them below.

Do I need to have technical knowledge to start an E-commerce business?

Some E-commerce platforms require you to know your way around the technical aspects of setting up your website, but others, like Shopify, have an easy-to-use platform, even for those who are not tech-savvy. 

That said, you must know how to run social media accounts to ensure your online presence remains high. This will help you increase your customer base.

What are the legal requirements for starting an E-commerce business? 

In the Philippines, you need to register your ecommerce business name with the Department of Trade and Industry (DTI). 

You must also get a permit from your barangay and local municipality/city. For tax purposes, you also need to register with the Bureau of Internal Revenue (BIR). 

Do I need to register my E-commerce business with the government? 

Absolutely. Registering your business with the government is not only a requirement, but also a way for you to prove to potential customers that your business is legitimate.

What payment methods should I offer on my E-commerce website?

This should be decided based on your target market. For instance, while credit cards and debit cards are the most common payment methods in ecommerce, you should also consider accepting other payment methods such as GCash, PayMaya, and Cash on Delivery. 

Also note if your target customers prefer BNPL (Buy Now, Pay Later) services. 

How do I handle shipping and returns? 

One of the most important things you need to consider when creating an ecommerce store is your return and shipping policy.

You should clearly specify your time frame and conditions for returns, including your refund or exchange policy. 

For instance, you can offer a 15-day return policy, as long as your customers have a valid receipt or proof of purchase, and the item has not been damaged. 

You should also specify if customers need to pay for return shipping or if you will be responsible for it. 

How do I promote my E-commerce business? 

It is vital to have a strong content marketing strategy for your ecommerce store. 

This will not only help you grow your social media presence, but it will also help you increase your sales, organic traffic, customer engagement, and customer lifetime value.

You can do social media marketing by using hashtags, posting frequently, and using relevant photos, videos, and captions. You can also use influencer marketing and tap into your customer database to spread the word about your online store. Finally, leverage the power of ads – both on social media and traditional platforms. 

How much does it cost to start an E-commerce business? 

Your costs will depend on the type of E-commerce store you want to create. For instance, selling products on Facebook Marketplace is free, but if you plan on creating your own website from scratch, expect to pay P75,000 or more. 

Meanwhile, platforms like Shopify cost roughly $29 to $299 per month. 

How long does it take to set up an E-commerce business?

This depends on the type of E-commerce business you plan on creating. In theory, you can get your business up and running in a few hours. 

However, it is recommended to work on your ecommerce store for weeks or months to ensure it looks good and runs smoothly. 

How do I create a website for my E-commerce business? 

This can be done by using a website builder, or by hiring a web designer or developer. 

What kind of support should I offer to customers? 

Customer support should always be prioritized. This is a way for you to show people that you are listening to their concerns and suggestions, and that you are willing to provide the solution to their woes. 

Email, chat, and message support are recommended. Also don’t forget to reply to comments/questions on your posts. 

How do I ensure the security of customer information? 

One of the most important things for ecommerce store owners to consider is information security.

There are several things you can do to ensure the safety of customer information. 

First, you can create a privacy policy for your site that clearly states how you will use and disclose customer information, including any third-party companies you might use. 

Your company should also have the right security protocols in place to prevent cyber-attacks.

As always, you should ensure your customers’ information (credit card details, contact information, etc.) is safe and secure. This can be done by using SSL encryption and ensuring the information is stored on a secured server. 

How do I handle inventory and stock management? 

Before you create an E-commerce business, you need to determine how you will handle inventory and stock management. 

The easiest way to handle this is to get a third-party service to do it for you since it can be extremely stressful. 

Can I start and run an E-commerce business from home?

Yes, you can start an E-commerce business from home, and even run it from there as well. This is perfect for people who want to get started immediately at a minimal cost.

How do I measure the success of my E-commerce business? 

This depends on the type of E-commerce business you plan on creating. In general, there are several key performance indicators (KPIs) you should be tracking.

For instance, you should be measuring your ROI, number of transactions, conversion rate, and sales and revenue growth. 

Aside from those, it is also recommended to measure your revenue per customer, website traffic, cart abandonment rate, and customer acquisition cost, among many others.

What are some common mistakes to avoid when you start an E-commerce business?

The most common mistakes to avoid when starting an E-commerce business include: 

• lack of proper planning 
• not being in the right platforms where your target customers are most active 
• not having a clear value proposition 
• failing to utilize tools and resources that would help your business grow
• not investing enough time to build your brand. 

But as long as you plan well, your E-commerce business will surely reach its maximum potential.

Now that you’ve gone through our article, you know all of the basic things to know when starting your business. If you need a reliable E-commerce partner, look no further than Payo!

As one of the country’s leading E-commerce enablers, we’ll help you from every aspect of your business — from Live Customer Support and Fulfillment to Cash on Delivery Integration and Advanced Remittance.

Sign up with us today or send us a message at [email protected]. We look forward to helping you thrive in E-commerce!

As a merchant in E-commerce, one of the most important things to oversee is your warehouse management here in the Philippines. If you want your brand to succeed, then making sure this part of your supply chain runs smoothly is a must. 

As an E-commerce and Logistics company in the Philippines, Payo knows the importance of being on top of your warehouse operations. That’s why we’re here to give tips on how you or your warehousing partner can effectively manage your warehouse.

Maximize the space

One important factor of warehouse management is knowing how to make the most of your space. As a guide, you should have a floor layout to follow. This will help you store everything you need to without making the space look cluttered. 

You should also consider warehousing equipment you’ll be using, such as carts, dollies, and even forklifts, when planning out your space. Will your team be able to move comfortably in the warehouse even if it’s fully packed? Where will the equipment be stored? Is the space used as efficiently as it can be? These are just some of the questions that you should find answers to.

Organize inventory 

Maximizing your space is one thing, but know how to organize your inventory is another. One of the most important tips for warehouse management in the Philippines is to be smart about how you fix inventory. Have proper labels and designations for different types of products. You should also have a guide or reference material to help you and your team familiarize with how you organize your space. 

Create efficient processes 

Having clear and efficient processes will help your warehouse team do their work better and faster. This includes your processes for receiving orders, packing, and handing out each package to the couriers. 

Make sure that each step of the process has a designated work station, and that everyone is aware of the procedure’s flow. You should also have processes in place for mishaps, such as packing the wrong items or handing off the wrong delivery. This way, your team will be prepared to handle unforeseen circumstances. 

Prioritize employee safety

The safety of your warehouse team should be a top priority. This means that the space they are in should be well maintained, clean, and well ventilated. On top of this, your team should also get proper training for handling packages, handling equipment, and for general safety. 

If possible, having drills for natural disasters such as earthquakes or typhoons is also ideal. Train your team not just in the warehouse processes, but also in what they should do in case they face an emergency. 

Leverage tech and automation 

If you want to get ahead when it comes to warehouse management, then integrating tech is now a must. Managing a warehouse can be challenging, but automation can make it a lot easier. You can adopt a warehouse managing system to take care of repetitive tasks. You can also use it to organize all your data and lessen manual errors from occurring. 

If done correctly, you can even oversee your entire warehouse in just a few clicks and taps! It can be that convenient, which definitely makes investing in automation worth it. 

These are just some of our top warehousing management tips. Since this is such a crucial step in your business, it’s understandable if it may seem overwhelming. Thankfully, there are companies that can be your warehousing partner to take care of all these and more. The best option for this is none other than Payo!

As a leading E-commerce service, Payo takes care of everything you need for warehousing. We’ll be the ones to store, pack, and ship each of your orders. What’s more is that we offer a Multiple Warehousing Solution for our merchants. This means we have warehouses across major cities in the Philippines, helping you reach more customers!

So what are you waiting for? Sign up with us today or send us a message at [email protected]. We look forward to being your reliable warehouse partner!

Putting up an online marketplace store is one of the easiest ways to sell your products. This is because you’re already provided with the tools for the online shop. This includes the platform you’re selling on and the platform where you can track orders.

However, an online marketplace is a double-edged sword. Competition is stiff, as you’re selling on a platform with hundreds of other shops – some of which may even be selling similar products. With this being said, one way to give your store an edge is through effective marketing. 

If you’re new to being an online marketplace seller, and you’re not sure how to go about your marketing plan, don’t worry! We’ve got you covered. Read on to learn some of the best marketplace marketing strategies you can use.

Do research on your competitors

As a new merchant, it’s important that you see what your competitors are doing. This isn’t so you can copy their content, but so you can see how they reach out to potential customers. Doing some research will also give you insights on the needs and wants of your target audience. 

Additionally, make sure you go through the channels that your target audience uses. Where you reach out to them is just as important as what you say and how you say it. 

Utilize in-app advertising and campaigns 

One advantage of using an online marketplace is that it usually already has advertising options. This can be done through in-app pop-ups, banners, and sale day campaigns. Some stores also invest in having their products show up first when customers enter specific keywords. 

Explore the possibilities on the app to make advertising and marketing easier for you. This saves you time and effort so that you can focus on running your online store.

Generate buzz with social media

Even if you’re selling on an online marketplace, that doesn’t mean you can’t attract customers through other platforms. One effective way to direct users to your store is by creating buzz on social media. 

Create witty and timely content that will engage your target audience. This helps create brand awareness, and will get them curious about your products. They might even follow your page, and eventually purchase a product once they’re ready. 

Maximize positive product reviews

One of the best ways to build credibility isn’t by talking about how amazing your products are; it’s by having customers vouch for you themselves. In today’s day and age, reviews and feedback play an important role in a customer’s purchase decision. That’s because these anecdotes are coming from people who already tried your products. 

Having said this, make sure to maximize your positive product reviews and store ratings. You can post these on social media so that your audience sees how credible your store is. It will also help if you respond to these reviews, even just to say thank you. This shows customers that you care about their experiences, and not just about sales.

These are just some of the best online marketplace marketing strategies that you should consider for your store. It won’t be easy standing out in an online marketplace, but staying consistent with your efforts will be worth it in the long run. 

If you’re looking to further elevate your online business, you may need to consider getting an E-commerce partner. If this is the case, there’s no better option than Payo! 

Payo is a leading E-commerce service in the Philippines that offers holistic E-commerce solutions. We provide everything you need, from Warehousing and Last Mile Management to Marketplace Optimization and Advanced Remittance.

Want to make E-commerce simpler and easier? Sign up with us today or send us a message at [email protected]. We’re looking forward to hearing from you!

Online shopping is all around us – whether on social media, an online marketplace, or on E-commerce platforms. It has become a part of people’s everyday lives, especially with today’s advancements in tech. 

In fact, online marketplace Shopee shared data regarding the increasing number of online businesses. According to the company, online sellers are growing both inside and outside of Metro Manila. This can be attributed partly to the fact that more shoppers are transitioning to the digital space as well. 

This isn’t surprising, especially given the advantages of online shopping. If you’re wondering what these are, here are a few examples. 

Ease and convenience

One of the most obvious reasons customers shop online is because it’s convenient. For one, you can do it from anywhere – your home, your office, or even while you’re on vacation. With just a few clicks and taps, you can go from viewing a product to purchasing it. 

Additionally, online shopping lets you shop whenever you want, meaning you’re not bound by store hours. Feeling like doing some shopping at 2 in the morning? With E-commerce platforms, it’s now possible. 

Saves time and effort

Another benefit of shopping online is how much time and effort it saves. Without E-commerce platforms, you’ll have to carve out time from your schedule to go to a physical store. This is especially challenging when the store is far from where you live. 

By shopping online, you don’t have to worry about going anywhere – all you need is your phone or laptop to purchase your products! Some stores even offer same-day or next-day delivery, which helps if you urgently need whatever you bought.

Variety of products

When you go to a brick and mortar store, it’s especially frustrating when they don’t have the item you need. It might even feel like a waste of a trip, and you’re left wondering where else you can get your item. That’s another reason why you should opt to shop online – if one online shop doesn’t have what you need, you can check out other shops in just a few clicks.

Additionally, E-commerce shops usually have a wider variety of products. This means you’re not limited to one type of product – you can shop for everything you need in one go. 

Easy price comparisons

One of the most common considerations when it comes to buying something is its price. As a customer, of course you want to make sure that you’re getting your money’s worth. With today’s E-commerce platforms, that’s easier than ever. 

Comparing prices of similar or the same products only takes a few seconds. In fact, some E-commerce platforms even do the comparisons for you, showing you which store offers the most affordable price. Doing this helps ensure that you don’t pay more than you have to for an item. It also gives you an idea of which stores give the best prices for future reference. 

Exclusive promos and discounts

E-commerce merchants know that one way of attracting customers is providing promos. That’s why another advantage of online shopping is having access to discounts or codes that are only available online. 

For example, many stores offer discounts for customers who sign up for their newsletters. Another one is promo codes that online stores use for certain milestones, such as hitting 10,000 followers on their social media pages. These discounts aren’t always available in physical stores, which is another reason customers love shopping online. 

These are just some of the advantages that shopping online provides. With the continuous advancement of tech, there’s no doubt that buying products on E-commerce platforms will become even more convenient in the future. 

If you’re an online merchant looking to establish yourself in Philippine E-commerce, there’s one way to find success faster; it’s by partnering with Payo!

Payo is the leading E-commerce service in the Philippines. We provide various solutions from Warehousing and Fulfillment to Marketplace Optimization and Cash-on-Delivery Integration. 

If you’re interested in learning more about how we can help you, feel free to sign up today or send us a message at [email protected]. We’re looking forward to helping you scale!

As an E-commerce service in the Philippines, Payo knows that there are many ways that merchants sell their products. One way they do it is by dropshipping in the Philippines.

Dropshipping is a retail shipping method where a merchant buys his or hers stocks from third-party suppliers. This means that the merchant can have a business without a physical store, or stocks on-hand. The most common type of dropshipping involves customers placing an order, the merchant routing this order to the supplier, and the supplier shipping the products.

Other merchants prefer having the products shipped to them first so that they can incorporate their own branding. However, they still ultimately get their products from third-party suppliers. 

Dropshipping in the Philippines has boomed, mainly because of all the opportunities it presents. If you want to understand why it’s gotten so popular in the country, here are some reasons! 

Easy to set up

Being a dropshipper is fairly straightforward. First, you just have to set up your online shop. You can use E-commerce platforms like Shopify, or put up your own website or social media store. After that, you can simply contact your suppliers when orders start coming in. It’s that simple!

Dropshipping, compared to setting up a traditional business, is simpler and requires less effort.

No physical store required

When you start your dropshipping business in the Philippines, you won’t have to worry about having a brick and mortar store. All you need is an E-commerce platform where you can showcase your products, and a reliable supplier. 

There’s no need to look for space for a physical store. Just create your brand, set up your E-commerce platform, and you’re good to go!

Warehousing and shipping are taken care of

Warehousing and fulfillment are one of the most important parts of E-commerce logistics. Thankfully, it won’t be something you have to worry about with dropshipping. That’s because your supplier will be the one taking care of this aspect of the business. This is just another advantage of choosing a dropshipping business model.

Product production isn’t necessary

Since you’ll be working with various suppliers of your choice, you won’t have to create your own products to start a business. You just have to pick and choose which items you want to sell.

When you do this, make sure to pick out products with good quality. It’s also important to work only with suppliers you trust, as they have a big impact on the success of your store. 

Let’s you focus on growing your brand

Because your suppliers take care of the packing and shipping aspect of dropshipping, it gives you the opportunity to focus on other business aspects, like marketing. By spending most of your time building your brand’s name and reputation, you have better chances of attracting customers. 

Furthermore, being a dropshipper means you don’t have to do everything alone – you have suppliers who help you with the E-commerce process!

These are just some of the reasons that dropshipping business in the Philippines have grown in number. It’s easy to see how these advantages, coupled with the booming E-commerce industry, entice merchants to try online selling.

If you’re looking for a reliable E-commece partner to help you with the ins and outs of dropshipping, Payo is the best choice!

 As a leading E-commerce enabler, we want to make sure online selling is as easy as it can be for you. That’s why no matter what solutions you need – from Live Customer Support to Marketplace Optimization – we have them for you.

To learn more about our solutions, simply sign up today or send us a message at [email protected]. We look forward to helping you thrive in E-commerce!