1. Choosing the product we'll sell
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Store building challenge
The whole journey:
This is where we start our journey. The first thing I want to say is that choosing your product is not necessarily the first step in building an e-commerce store. You may already have a product in mind, or you may as well need to figure something else before deciding on a product. Each entrepreneur has a different scenario with particular needs. Mine starts with the product, just because I have to start somewhere.
The easier start: current connection with a product
Choosing what to sell would be simpler if I already had a connection with a product. For example, if my mother had a brand that creates leather belts, I might start selling them online; if I were into crafting notebooks, these could be my products; if I had a friend of mine who owned an automotive parts supplier, I could partner with him to turn his business into a B2B online store.
Unfortunately, I have none of these connections, which is why "current connection with a product" will not factor in my scenario.
Trying to fill some requisites
There are multiple approaches to the problem of finding a product to sell. You will find plenty of "shortcuts" on the internet. To tell you the truth, they can only take you so far. In general, these shortcuts apply better to "easy side money" short-term initiatives, not to sustainable businesses.
In the dropshipping model scenarios, for example, you often find people telling you to look at the Amazon best-selling lists or to look for trending keywords in Google Trends. I wouldn't wholly disregard these approaches, but again, they are not that relevant for entrepreneurs building long-term sustainable businessesâwhich is what we are trying here.
So, let's move to more relevant questions. You can see them as product requisites that we're trying to fulfill, considering my specific scenario:
Logistics:
It's easy to manipulate. I often see entrepreneurs that are not even selling yet spending a lot of money and energy on logistics. I don't want to go there. Before having a fully-fledged store, I want to create a prototype. And it's not a prototype if you are already hiring space in a warehouse out of town. But of course, it's more challenging to stock it all in your room if what you're selling is industrial air compressors.
It's small enough for me to stock it at my apartment during the first weeks. The reason is the same as the previous topic.
It doesn't go bad fast. I'd like to be able to store my product for months without it going bad. This is important to give me a safe time window to sell it. A perishable product, with short shelf life, would force me to work with a high inventory turnover ration right upfront (unless I could find a logistic workaround).
Supply chain:
I have easy access to suppliers:
Market:
It's a niche product, but not a ridiculously small one.
Price points in the market are not determined by competitive advantages that I won't be able to beat as a newcomer.
The business model:
It's subscribable. I care a lot for predictable recurring revenue in e-commerce. So I'd love to sell a product that makes sense for people to subscribe.
Emotional connection:
I like the product. This part may seem irrelevant, but it's essential for me. I want to enjoy talking about the product; I want to deal with it not only because it brings me money, but because I care about it and the experience my customers will have. This is partly because I want to have fun with my business, but it's also because I believe that selling something you like increases your chances of success.
I'd like to stress that these are my requisites. They are much based on the place where I live, the people to which I have access, and especially my previous experiences. Your requisites might be very different.
So what's the product?
I decided that I will sell specialty coffee.
It fulfills most of the above requisites, but not all of them. Let's take a closer look.
â Easy to manipulate.
The coffee comes in little bags. They're pretty easy to manipulate and don't require much caution.
â Small
I'd say I can stock around 200 coffee bags in my apartment at a time. It should be enough to get things going.
â Not perishable
Coffee is perishable. It's hard to fulfill every requisite, and this was the one I couldn't. It's a bit of a bummer because I've had trouble in the past with perishable products. I hope these previous bad experiences give me enough knowledge to find a workaround now.
â Easy access to suppliers
I live in Brazil, which is the foremost coffee exporter in the world. Additionally, I live in the region where most of the best coffee producers are. It's not a 30-minute ride from home, but:
I can certainly reach many of the farmers by car if I need to.
Delivery from the farms to the place where I live should be quick and easy.
There are many outstanding coffee brands run by farmers who have simple operations, with no exclusivity contract.
â Niche product
Specialty coffee can be considered a niche product. In Brazil, there is a trend that's been slowly growing over the last years. A small percentage of coffee drinkers have been discovering the complexity of the coffee universe, with all its different varieties and extraction methods. These people are the ones I'll be talking to.
But also, if the trend goes on, there is a huge universe of traditional coffee drinkers to be explored. Despite being one of the biggest exporters, Brazil is also one of the biggest consumers. And I think it's safe to say that most of the people have never even heard the term "specialty coffee."
â Price points
The big grocery e-commerce players are still focused on the mainstream coffee brands. It's hard to find products from small farmers on supermarket chains or even regular stores. So, for now, there seems to be space for competing for the same customers applying the same price points.
â Subscribable
Besides pet food, coffee is probably the product most fit for the subscription model I can think of. In Brazil, at least, coffee drinkers usually drink it every single day.
â Emotional connection
I love coffee. So there you go.
Let's test it
I'd like you to join me in a testing mindset for this journey. Let's keep our minds open to make mistakes, learn from them, and iterate.
By choosing a product, I'm setting a hypothesis. We will start with it and see how it goes. If we need changes, we'll make them.