Hi all,

I am looking for some advice on starting a small online retail/wholesale store and the costs/process behind doing it.

I am currently working full time and intend to continue to do so whilst trying to develop an online business.

My aim is to set up a company, buy in 3 or 4 products which I have researched and feel would be a good seller and import in reasonable quantities from china. I will sell these products via ebay and via an online website.

My question:

1. Would you advise starting up as a sole trader or limited company in this scenario? I don't expect the turnover to be anywhere near 64k so my thoughts are for a sole trader, however I am concerned suppliers will not deal with me.

2. I dont want to trade under my own name so how do you register a company if you are a sole trader and how do you operate without a VAT or business registration number?

3. I have some basic experience in a previous job of dealing with Chinese suppliers and have imported for a limited company. However, how does this process differ for sole traders? Will Chinese suppliers still deal with a sole trader?

4. I have about 10k to invest at start up. I am estimating approximately 8k+ for stock of the 3-4 products i will import. What costs am I looking at to register the business name and to get a basic website up and running which will advertise the products? It would need an online cart for payment etc.

5. As I will be starting with 3-4 products would you recommend using a dropshipper to add to the product range so that the website and business looks more professional?

Sorry for all the questions but any help would be greatly appreciated.

Cheers
Jon

In terms of your trading status, I would register as a sole trader, at least for the time being. I would also say VAT registration should be avoided until you meet the threshold or your business plans predict that you will undoubtedly do so. It keeps things simpler that way.

You can still have a company name as a sole trader, but it won't be quite as official as a Ltd company nor will you get any form of registration number.

If you're going to be doing business in China you'll soon learn that money talks. They really will not give a second thought as to whether you're a Ltd company or sole trader, VAT registered or not. Really that's not going to be an issue (a different story with many UK suppliers however).

The cost of a website varies, it really depends what you're looking for. Personally I would budget £500 - £1,000 for a decent e-commerce site.

As for using a dropshipper to pad out your store with more products, this could work quite well but personally I would focus your efforts on those 3 - 4 products and then expanding your range over time.

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Last edited by PT; 18-06-2009 at 11:52 PM.

Get a website ASAP.

The key to the online venture is not to expect huge traffic straight away, PPC advertising will help but is only for the term of what you can afford.

As mentioned above start NOW, even if you simply upload a few page of unique/informative information in your selcetd niche to give the search engines some juice. Also dont simply put them onto your homepage put them as pages off from it and include a simple menu on the home page to link to it (these links also help with your ranking in the long term).

Also as mentioned I would use the services of a professional designer (unless you have the necessary skills) as this allows you to easily establish some brand identity straight from the box.

Supplement your venture by using other established sales venues such as Ebay, sure there are fees but in business to be successful you have to account for fees and as such these can be pretty much negated if your planning/sourcing is adequate...

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In terms of building a website and getting the hosting, have a word with 'Pete'. He offers some very good value hosting and I believe he will implement a cPanel cart for you.
As for your products, I agree with PT. Concentrate on a small number and when you start making profits on them, put some to one side to reinvest. Then you can start to build up your products and your experience.

Originally Posted by Ultravox

In terms of building a website and getting the hosting, have a word with 'Pete'. He offers some very good value hosting and I believe he will implement a cPanel cart for you.

And me

Sorry and Saajan. Both are reliable and cost effective!

Originally Posted by Ultravox

Sorry and Saajan. Both are reliable and cost effective!

No problem :niceone:

Thank you for suggesting me.

I deal in ecommerce websites / hosting, so if anyone is interested, just PM me or reply on this thread.