What the ’90s was for the internet and ecommerce, 2021 is for international ecommerce. Technology has made it possible to expand ecommerce in ways that dissolve borders and shrink the distances between countries. Thanks to this trend, the business landscape has changed drastically over the last 10 years, so that it is now more conducive, practical and profitable for managing an international online business than ever before.
Below is a master plan broken down into 11 tasks or to-do’s that will get you from the starting point to the launch of a successful ecommerce site.
1. Shipping: This is probably the most crucial and fundamental aspect to lock in as you plan to build your international business. The cost and effort involved in shipping will also influence your margins and ability to do business in such a way that your customers find it worthwhile to order from your store. You will have to factor all your costs for shipping, packaging, customs duties and taxes into one best negotiated rate, which the buyer can see upon checkout as they make a buying decision. The best way to start is to set up a shipping account. If your sales volume will be over $50,000 a month, you can do this directly with a shipping company like DHL, UPS or FedEx. Otherwise, you can go with a shipping aggregator like Goshippo.com, which offers multiple courier options; connect it to your shopping platform and it can give real-time pricing for shipping and customs clearance. Thankfully, the margins in the adult products business can support reasonable shipping costs, so many stores can offer incentives like free shipping if order value is over $100.
2. Payment gateway: When you plan to sell to audiences from multiple countries, it makes sense to offer them a payment gateway where they can pay in their own currency, and which converts this back to your home currency and deposits in your account. This is called multi-currency processing, and several high-risk merchant processors offer various gateways and combinations of accounts that can offer this premium feature for online adult stores. The two merchant processing companies I would recommend are PathwayPayments.com and EMerchantbroker.com. They both are very familiar with high-risk business needs for an MCP payment gateway that will connect with most shopping carts, aka e-commerce platforms.
3. Supplier/distributor: Unless you have plenty of capital to start and enough to invest in your inventory, it makes sense to purchase it from a reputable distributor or supplier who stocks most of the brands you wish to showcase in your store. The difference in cost may be 10-25 percent, but that will free up your cash, allow you to stock or sell only what’s needed without the need to purchase in bulk or case quantity and also allow you to experiment with what sells best on your store. In most cases, they may even pack and ship the order for you. That’s one of the best options for automation if you are an up-and-coming new e-commerce business. Some of the most reputable distributors in the adult business are Entrenue, Eldorado Trading and Holiday Products.
4. Warehousing: If you are a manufacturer or wish to invest in buying inventory from the manufacturers or their master distributors, then you will need to plan a warehousing model in your business operations. Traditionally that would have meant you’d have to lease an office/business space and furnish it, set up SOPs and hire a manager and team to manage order processing and shipping from end to end. However, we now have several other options to accomplish this same result. You can contract one of the many available third-party logistics warehouse operators who will handle this for you, end to end. Some of the well-known ones are ShipBob. com and Fulfyld.com.
5. Ecommerce platform: This will be your storefront, the back end, your catalog, cash register and everything that will be the brain of your business, so you want to choose this one carefully. With a plethora of choices, you want to identify which platform offers the most value and ease of setup and operation, has a network of experts available to design and develop the store and has an ecosystem of apps that make it easy to do business. The only recommendation I have for an ecommerce platform is Shopify.com. While it may appear higher-priced than competitors, you get what you pay for. It has great system infrastructure that supports growth and expansion, and it is intuitive and built for providing ease, security and sensibility in doing online business. The price starts at $29 to try it out, but will usually cost $200-$1,000, based on business revenue and what apps you decide to install and use.
6. License, registration and trademarks: Start your incorporation and trademark paperwork and filings early on. Usually, for running an ecommerce business, you would need to register your business entity with the department of corporations in your state, apply for a ecommerce business license, apply for an EIN number with the IRS for tax purposes and file for sales tax certification with your county. All of the above can usually be done online and in a day, with a modest amount of online research. Make sure to register your domain name on GoDaddy and apply to trademark your brand with the USPTO online as well.
7. Customer service: Now that your core functionalities of your business operations are identified and secured, you want to prepare a comprehensive process to deliver excellent customer service for your brand/store. While you can engage in this yourself or hire a small team, usually picking the right candidates and providing them with necessary training and guidance establishes a good foundation for this process. You will have to choose an efficient CRM to manage your customer service operations; the top two I can recommend are Freshdesk and Gorgias. They are integrated with Shopify and will give you various tools for managing communications with your customers via a system of tickets and solutions using all available modes — chat, email and phone calls.
8. Marketing: How do you get the word out? The most efficient and effective ways are email marketing, Facebook and Instagram ads and proper SEO to enhance your organic listing. Being that the products are of adult nature, you may face hurdles in marketing on social media, so plan to go organic from the ground up. A combination of micro-influencers and content creation will get you ahead in the race; however, unless you have an excellent personal network, then yes, these activities will take time to yield results. In addition, think of getting PR by collaborating or partnering with brands, experts and other similar businesses.
9. International staffing: Conducting an international business may require hiring a team to handle customer service, sales or various other roles in your business. While you can still interview, hire and train people virtually, you will need to figure out how to hire them as contractors and how to maintain regulatory compliance in their countries. For this, you can sign up with LetsDeel.com, which provides Employer of Record services without you needing to establish a legal entity in a different country. This allows you to manage payroll and handle all employment regulations without the expensive need to set up an office in every country.
10. Pricing, warranty and margins: For your business to sell products and make a decent profit, you may need to consider what margins you want to keep to run the business profitably while maintaining enough revenue to pay for your costs of operations. In the adult business, your margins would usually range from 20 percent to 50 percent depending on how well you have negotiated your terms with your distributor and/ or manufacturer. Your cost of operations should be well covered with 20 percent of your margins and if they are not, you need to consider trimming the fat where it exists. Plan an efficient warranty replacement arrangement with your suppliers to ensure these processes do not end up costing more than the profits you made in that sale. If you factor in costs of international shipping, you will have to keep margins at a minimum of 40 percent to be able to offer free international shipping as an incentive.
11. Hiring: In-house, outstaffing and agencies. The last step in the process of establishing an international e-commerce business is to decide which team to hire in-house and manage yourself, which team to hire as contractors — either part-time or full-time — and what business processes to assign to contractors. Usually it’s best practice to hire an operations team in-house, which includes customer service, sales, back-end operations and day-to-day administration. For social media, digital marketing and website management, you can choose to engage professionals who specialize in these services for a fixed or dynamic retainer and manage their deliverables using a project management application like BaseCamp.com. If your business is moving to growth stage, you may want to engage agencies that provide a more holistic approach to the above services and can handle the whole scope end-to-end, lessening your dependence and time commitment to allow you to work on your business growth and operations.
If you have been on the fence about exploring international frontiers, now is a great time to start. Never before have all the parts of the machine come together as beautifully as they do now. The internet and social media have made brands more accessible to audiences worldwide. Now is the time to open your doors to the global audience and really think outside the box. Because after a hard day’s work, you will sleep well knowing your store is always open 24-7, and make money even while you are sleeping.
Raj Armani is the COO and co-founder of online retailer ImBesharam.
