[0:00]Hi, and welcome to my free six-day mini course. Now in this course, I'm going to provide you with a high-level overview about what it's like to start your own niche online store and give you a high-level introduction to e-commerce.
[0:16]So what are you going to learn? So first of all, I'm going to teach you about all the different online e-commerce business models and how they work. Then, I'm going to teach you how to evaluate profitable products to sell online, how to find your wholesale vendors with which to stock your goods. And then I'm going to teach you how to create a great-looking website without any technical experience whatsoever. And finally, I'm going to go over everything you need to create an niche online store, including all the setup, how to accept credit cards, how to design your site, everything. You'll also learn how to drive traffic and get your first sales. Now, who's this course for? Now this course is for you if you are a parent who wants to work from home to take care of your kids. This course is for you if you want to replace your income and quit your job.
[1:04]This course is for you if you want a flexible schedule to do what you want and spend more time with your loved ones. Now here's what you want to keep in mind. It does not matter if you don't have any products to sell at all, or if you're not sure what you want to sell, because I will teach you how to launch a profitable online store from complete scratch without any previous knowledge required. Now before I begin, I just want to talk about a small sampling of the students in my class who have gone on to create very successful online stores. First off, my student Abby, she started vivianlou.com. She sells high heel insoles for shoes and she makes over $100,000 per month selling only on her own website. And once again her website is over at vivianlou.com. By the way, all the shops that I'm going to show you right now are live, and you can literally type them into your browser and check them out for yourself. Angela started a six-figure business selling jewelry without paying for advertising over it aazurajewelry.com through Instagram marketing alone. Amanda Wittenborn, she makes seven figures selling her own cards and her own invitations print on demand over at amandacreation.com. And then finally, Joel Cherico is a student that sells his own hand-thrown pottery over at cherricopottery.com and he makes a mid six-figure income online. So who am I? My name is Steve Chou, and I run the popular blog mywifequittherjob.com. Now presumably, you guys signed up for this six-day mini course on my website, so you are probably already familiar with the website. But I also run a popular podcast called How to Quit Your Job. And you can actually go on iTunes and check that out. I interview bootstrapped business owners and basically delve deeply into how they got started and how they grew their businesses. And finally, I run an annual e-commerce conference called the Seller Summit. And basically, I bring together a whole bunch of people who are selling online and we share our secrets on how to be successful. Now before we get into the guts of this mini course, I want to take a step back and talk about the early days of my own e-commerce store. I actually got into entrepreneurship way back in 2007. And I actually remember that year very clearly because both my wife and I, we were stuck in a rut. Now we both work full-time and we both made six-figure salaries, but here's what our life consisted of. We would basically wake up, go to work, come home, eat dinner, watch TV, go to bed, wake up the next morning, go to work, come home, have dinner, watch TV, go to bed. And this cycle repeated itself over and over and over again. Basically we were stuck in a rut. We weren't going anywhere with our lives and it was just the same routine night in and night out. Now this lifestyle wouldn't be so bad, but my wife really hated her job. So every single morning on her way out the door, she would pull me aside and she would say with a pitiful-looking face, Okay, honey, I'm off to the hell hole I call my job now. Now if you can imagine, I had to watch her go to work every single day. I had to watch her long face every morning and it was actually quite depressing. And deep down, I knew that she needed to quit her job. I knew that we should start our own business, but we could never get the courage to start. Not only that, but we could never find the time to begin either. But then something happened. My wife became pregnant with our first child and everything changed overnight. And I actually remember that day very distinctly because I was super excited and terrified at the same time. On one hand, I knew that this was the perfect excuse for my wife to quit her job, but the problem was that we live in an expensive area. Almost everyone around us works full-time, like both spouses work, because it actually requires two working parents to get a good house in a good school district, so that your kids can actually get a good education. So what ended up happening is that we started brainstorming different businesses that we could start so that my wife could stay at home, and that's how we stumbled upon e-commerce. And so that year, in 2007, it's actually a long story, but I'll tell it really quickly here. We started an online store selling handkerchiefs, and our store can be found over at bumblebeelinens.com. Feel free to check it out. We've been running it for over 10 years now, and we decided to sell handkerchiefs because when my wife and I first got married, she knew she was going to cry at the wedding. And we paid a lot of money for photography, and she didn't want to be seen on camera drying her tears with a ready tissue. So we looked all over the place for handkerchiefs, couldn't find any, and finally we found this vendor in China, but they were only willing to sell us several hundred because they were a factory. So we ended up buying a whole bunch of these handkerchiefs, used maybe six or so and we sold the rest on eBay and they ended up selling like hotcakes. So when she became pregnant, we actually got back in touch with that vendor and started bumblebeelinens.com. And within that first year, we managed to make over $100,000 in profit and replaced my wife's six-figure salary. Now, as I mentioned before, we've been running this store for the last 10 years and it's actually grown in the double and triple digits ever since 2007 and today it is a seven-figure business. But more importantly, my wife is just so much happier now, and here's a picture of my beautiful family. Both my wife and I have the freedom to spend all of our time with them. I never miss a soccer game, I'm there for all their school activities and the lifestyle is just so much better for us. Anyway, that is just a quick story about how my wife and I got started in e-commerce. Now before we begin with the tutorials, I do want to talk a little bit about my philosophies for this course. So first of all, what I'm going to be teaching you today is not a get-rich-quick scheme. It is also not about starting the next amazon.com or the next Facebook or the next Google. We are here to start a business that suits your lifestyle, running a business that allows you to spend time doing the things that you love or hang out with those people that you love. And a business that also allows you to set your own schedule. Now what sets my class apart from the others is that I'm actually going to teach you how to start a long-term branded business. There are a lot of business models out there on the internet that will teach you how to make a quick buck, but I'm going to show you how to create a business that lasts the test of time and allows you to hang out with your family as well. Now as I mentioned before, we've been running Bumblebee Linens for over a decade now, and we anticipate running this business for another 10 years. Now what are some of the advantages of selling online? Some of my readers on my blog, come to me with brick and mortar stores and they want to take their operation online. Well the beauty of selling online is that you actually don't need to be physically present to make money. Your computer takes orders for you while you sleep, and there's actually very little overhead to actually maintain a website. Most of the software is already written for you, and basically you just have to customize it to your particular business and brand. Now the number one question that I always get asked is, hey Steve, why should I bother starting my own online store when I can just sell on eBay, Etsy, or Amazon? Now let's just take Amazon for a sec. The problem with Amazon is that they don't have your interest in mind. Their primary concern is with their own growth and their own stock price. They can raise prices at any time. They can change their algorithms and make your products harder to find. And in fact, Amazon routinely changes the rules. And just the past year, they've raised their prices significantly, changed a lot of the rules that have made selling a lot more difficult. Also, when you sell on platforms like eBay or on Etsy or on Amazon, they don't allow you to have any sort of design flexibility. Every single product listing follows a very similar design template and it's very hard to stand out from the pack. And when you can't stand out from the pack, that means it's very difficult to establish your own brand. Not only that, but these marketplaces charge a huge percent of your sales. So for example, eBay will take maybe 11 to 15% of your revenue. If you're selling on Amazon and Amazon is fulfilling your orders via FBA, Amazon will take between 15 and 35% of your revenue. Now these marketplaces are actually a great place to start out and validate what you're trying to sell, but in the long run, you're going to want to have your own branded website. After all, you don't want your business to be at the mercy of someone else. You want complete design flexibility in order to stand out from your competitors, and you want to be in control of your own destiny. And most importantly, you don't want someone else calling the shots on your business and your livelihood. You want to establish your own brand and you want to future-proof your business. Now I thought I'd just take a couple of moments to dispel some of the common myths of small business ownership. Because I know that when my wife and I first started out, we were terrified. We were scared about all these statistics online. Now one of the statistics that I actually hate is the fact that nine out of 10 small businesses fail. And the reason why I hate this stat is because I believe that these nine people who are failing are jumping into their business without any training and without any prior knowledge. They're basically just bumbling their way through it, and of course, when you do it that way, most of the time you are going to fail. So the first myth I want to dispel is that starting a business is too risky. So first of all, my wife and I started our store on the side while we both worked full-time jobs, and we actually risked next to nothing to start the business because we used an open source platform to run our store, which is 100% free. There were no programmer costs, there were no real development costs, and we basically did everything on the side when we got home from work. So basically, we worked nights and weekends and made things work. So you absolutely do not have to quit your job, and I would say that you should be at least willing to devote at least five hours per week to your business. Now another common myth is that it costs too much to get started. Now back in 2007, my wife and I actually started bumblebeelinens.com with only $630. Our main cost was a digital camera, a computer, and $300 worth of inventory that we got from China. Now let's say that you don't even have $630 to start. Well, if you go with one of the lowest cost business models out there, you can actually get started for $5 a month. The overhead for maintaining an online business is so low that today, even if our business were to grind to a halt, it would actually only cost us about $80 a month to maintain our store. Now another myth is that you actually have to carry inventory. But you don't. One, you can dropship, and how dropshipping works is you take orders on your website, you make an arrangement with the vendor, they'll actually ship the goods to the end customer. So they hold all the inventory and they are responsible for fulfillment. You are responsible for collecting the money, making the sale, and then you pay your supplier. Also, if you don't have room to store inventory in your house, there's a whole bunch of third-party fulfillment services out there that act like warehouses. You basically send them your goods, and as soon as you get an order, you tell them and they ship it to the end customer. And finally, there's also Amazon. Amazon will take your inventory and ship everything to the customer as well. Now, one of the most common fears that I get from the people who read my blog is that they think that starting a business or starting a website is just too hard. And let me tell you that starting an online store today is so much easier than back when my wife and I first started in 2007. First of all, you do not need any technical knowledge to begin. All the software is written for you. There's a bunch of open source shopping carts out there that are completely free, and all the code is written for you, and all you have to do is install them on your web host. There are also fully hosted platforms like Shopify and BigCommerce, which basically handle all the heavy lifting for you, and all you have to do is list your products. Now a lot of the fully hosted platforms, which I'll introduce to you in the next couple lessons, they offer drag-and-drop interfaces so that you can customize your store without knowing any HTML or any code whatsoever. Now the next few lessons of this mini course will present you with different options depending on what you're comfortable with in terms of technical skill. So for example, if you are a little bit tech savvy, I'll probably point you over to the open source shopping carts where you actually own the platform. But if you're totally tech averse, I'll probably point you over to platforms like Shopify or BigCommerce to keep things simple. The key thing to keep in mind here is that I've done all the shopping cart research for you. Now a lot of people complain to me, and we actually had this excuse too, is that you don't actually have enough time to start a business. If you look at my life back when I first started my businesses, I was running a blog, I was running a store, I had two young kids, I was running a training class, a podcast, and a conference while working full-time as an electrical engineer. Now I'm not Superman, and in fact, I consider myself to be quite a lazy person. The key to productivity is to break your test down into small pieces that can actually be accomplished in 20 or 30 minute chunks. What you want to do is you want to work your businesses into your routine, do a little bit each day and think in the long term. Now let me just give you a quick example. When I started my e-commerce course, I actually started with no content at all, but what I did was I told myself that I was going to put out one or two pieces of content every single week. Now I started this class back in 2011, and fast forward to today, I actually have over 300 videos spanning over 100 hours of material. So just by working on it a little bit on a steady pace every single week, I eventually grew it to something much, much larger. That is the mentality that you have to take with your e-commerce business, because after all, you can't wait for a big block of time, especially when you have kids. Big blocks of time do not exist. You basically have to work everything into your routine. Now one thing I do want to tell you though, is that once you get your business started, it is really exhilarating. I still remember back when we've got our first sale, my wife and I were just so thrilled. We were so happy because there's something to be said about making your own money and making your own sales versus working a full-time job. It is a very rewarding experience, and I guarantee that you will enjoy the experience if you just take the chance. So now I want to switch gears and delve into the guts of e-commerce. And the first thing I'm going to talk about are the different e-commerce business models to choose from. So one business model I want to talk about is drop shipping. As I mentioned before, the way dropshipping works is you have a storefront and you take orders, and then you have an arrangement with a supplier where the supplier actually sends the goods to the end customer. You don't have to hold inventory at all, and basically the money you make is the difference between what you're charging and the wholesale cost. You can also start an online store and sell other people's brands and other people's inventory. There's a lot of examples like this. So for example, Target carries very few of their own brands and they primarily sell other people's products. And then finally, you can sell your own branded products, which is actually the best long-term solution. This is basically where you go out and you have your goods manufactured, and then you put your own brand on your own products. And finally, you can sell as an affiliate. And the way affiliate marketing works is that you refer a sale to another business, and then that business pays you a cut of the referral. So to help you decide which e-commerce business model to choose from, I'm going to evaluate these models based on three parameters. The first parameter is effort. How hard is it to get started? The second factor is sustainability. What is the long-term potential of the business model? And then finally, I'm going to talk about all these business models on a profitability scale. How much money can you make? And please note that all these factors will be rated on a scale of one to 10 with 10 being the best. So let's start with dropshipping. With dropshipping, because you don't have to carry your own inventory and because you don't have to source any product, it's actually one of the easier online store business models to have. As a result, I give it a seven out of 10 in terms of effort. However, in terms of sustainability, I give it a four out of 10, and here's the reason why. When you are dropshipping, you're selling other people's products and the margins for dropshipping are actually quite low. They're often on the order of 10 to 25%. And what that means is that you're going to be making much less money, and you're selling other people's products, and you're going to be going up against other people who are carrying inventory and they'll have better margins than you will. Because you don't have that much flexibility in terms of price, and because platforms like Amazon where manufacturers are selling directly on Amazon, and basically bypassing the dropshippers, it's going to be very difficult to compete on price. So that's why I believe that dropshipping, out of all the online store business models, is not very sustainable in the long run. In terms of profitability, as I mentioned before, dropshipping gets 10 to 25% margins. Now if you compare that to 50 to 90% margins for some of the other business models, and you realize that you have to make a lot more sales to make the same amount of money. Let's talk about a traditional online store next. A traditional online store sells other people's products and you carry inventory. Now because you have to go out and contact vendors and store your own products, I give it a five out of 10 in terms of effort to get started. In terms of sustainability, I give it a seven out of 10, because you're establishing your own branded store with inventory and fulfillment. And in terms of profitability, your margins are going to be on the order of 50%. So you're going to be a lot more profitable than a dropship store. Now the next business model is selling your own branded goods. Now in terms of effort, I give it a three out of 10, which means that it's harder to do. And the reason for this is because you actually have to reach out to manufacturers, build your own products and put your own brand on them. But the best thing about selling your own branded product is that it's the highest sustainable business model out there, because you actually own your own brand and you own your own goods. In terms of profit, your profit margins can be 90% plus, which basically means that you get to keep most of the money that you're making online. As a result, selling your own goods is probably the most long-term and the highest profitable business model out there. And then finally, the last business model is affiliate sales. And once again, that's basically when you're referring someone else to another company, and you basically get a cut of the sale. Now effort level-wise, affiliate marketing is the easiest, because you don't have to do anything to get started, and it requires almost no upfront cost. All you got to do is point your customer to a different website where they take over, and then they're in charge of closing the sale. In terms of sustainability, I give affiliate marketing a three because of lack of control. A lot of companies, when they're first starting out and they need customers, they're all about attracting affiliates. But once these companies become more established, they don't need their affiliates anymore, and often times more established brands will just flat out cancel their affiliate programs over time. So in terms of profitability, because you're not doing any work, the payout for the referral is often pretty low. So you actually have to refer a lot of sales to make a good living. In any case, that is just a high-level overview of all the online store business models out there, and I hope you enjoyed this first lesson. Keep in mind that you're going to have new lessons coming to your inbox every single day, and they are going to be sequentially numbered, 1, 2, 3, 4, 5, 6, 7, 8. In the event that you miss a lesson, or for some reason, a lesson doesn't get sent to your inbox, send me an email over at steve@mywifequitterjob.com, and I'll forward you the lesson that you're missing. Thanks a lot. Hope you enjoyed this video. Now if you like what you saw, there's actually a lot more where that came from, if you subscribe to my channel below. And if you are interested in learning how to sell physical products online, then click over here and take my free six-day mini course where I'll walk you through everything that you need to know to get started in e-commerce. Thanks for watching.
