For someone who wishes to start an e-commerce business nowadays, the startup is not as expensive as it used to be and websites can now be built within hours with ease due to the presence of templates and free website hosting. What these entrepreneurs fail to see is that majority of start-ups, around 80 per cent, fails in making their online business a success. Here are some of the most common reasons why many online businesses do not succeed.

  • Lack of investment. For an online store that is just starting out, many believe that a few hundred will be enough to set up the basic website, have it up and running and launch it as soon as possible. Many do not realize that it needs more than a few hundred dollars of investment in order to be fail proof. Businesses that have physical stores and are venturing into an online shop must know that having an online shop means opening up another branch which requires proper investment.
  • Absence of cash flow. Cash flow, by its simplest definition, is the flow of money that is going in and out of a business. There must be enough cash on hand in order for an e-commerce shop to remain operating for a long time. If all cash has been invested into the inventory with nothing left for marketing and ads then the business will remain stagnant and will eventually fail.
  • No proper inventory management. The inventory must be managed according to the needs of the business. If there are too many supplies in the inventory, the cash flow might stop while having less supplies in the inventory could mean fewer sales for some businesses which in turn disappoint expecting customers.
  • Poor website design. If you have the best plan when it comes to your business, it will all be for nothing if the website is lacking in so many ways. In order for an e-commerce site to succeed such as, it must be secure and fully functional. Items must be easily searched and it must also be responsive to mobile devices. Most of all, it must load very fast.