Why an Entrepreneurial Mindset is Necessary in eCommerce

An entrepreneur is a different beast.

An entrepreneur is someone who views things differently, doesn’t give a damn about failures and is madly in love with the dream compelling them.

An entrepreneur is drawn to opportunities, even creating opportunities where none exist.

An entrepreneur learns quickly from failures and does not shy away from repeatedly working hard until success finally comes.

Many traits define an entrepreneur. In this post, we’ll look at those traits most associated with entrepreneurship then explore how they apply to eCommerce entrepreneurship.

Grab your seatbelts.

Perseverance

Chief among the traits is perseverance- the ability to stand up and face the world despite failures.

As Robert Herjavec put it, “The most successful people I know bounce back, are resilient and use failure as a learning experience. They don’t fail twice, and when they do fail, they fail fast! I also find that successful people have a passion to accomplish something bigger than themselves. Maybe it’s for family, maybe for the community, maybe to change the world — but they are driven by something other than themselves and money. Passion can fuel you through good times and bad as a business owner.”

Risk-taking

You need to take risks in order to research and fail on several products before you find the right product-market fit.

It may require that you lose some money and few nights sleep before that happens, but in the end, it will all be worth it.

Being street-smart

Barbara Corcoran, “Shark” investor on Shark Tank always looks for entrepreneurs who’re fast thinking and possess basic common-sense.

She believes that only those with awareness about what’s going in and about the industry can thrive in the long-term. Adaptability is the key.

When one door closes, savvy entrepreneurs with street-smarts find three new doors to knock on.

So how do these traits apply when selling goods online?

Problems faced in eCommerce and how these traits help you tide over them

Returns, refunds, discounts and losses

Here are some of the problems as summed up from Ecomom’s failure.

Established in 2007, by 2013 the company was doing 4 million in annual revenue. But what ultimately shut it down was the lack of attention paid to margins.

Simply put, for average orders that sat at $60, the company was spending $89 thus losing $29 in the process.

Heavy discounting— a strategy mimicked from sites like Groupon was the reason behind the fall.

For others, free shipping or higher frequency of returns might have been the reasons behind their failure.

Lacking the right mindset will land you in similar hot-water. Sometimes, even if you’ve got the right mindset, you may land in a similar mix.

What would get you out of this mindset is how you choose to deal with the problem.

The vast majority of customers merely want the product they paid top dollar for, not to fabricate problems.

It isn’t right to pin the entire blame on customers while ignoring any angle that may have gone wrong on your end.

It’s alright to make mistakes. However, problems arise in not taking ownership in a client facing dialogue.

Mastering the learning curve

Whether it be business or life, most things present a learning curve.

Without proper mastery, mistakes are bound to happen. It’s also possible that mistakes and failures arise when you overestimate your skills.

Don’t let such things cloud your judgment and inhibit growth.

A proper entrepreneurial, open mindset is needed to keep learning while mastering Facebook ads and setting bids on AdWords. More subtle aspects of the work such as hiring the right employees and firing underperformers are essential.

Roney Teja founder of eCom Masters recently gave an interview during which he stressed the importance of the initial months in terms of hiring the right talent. He made a lot of hiring mistakes and finally took months to find the right fit for his business.

Just because you don’t find someone right at the first hire doesn’t mean you should lose all hopes of eventually being able to find a good hire.

When the platform shuts you down

Every eCommerce business model whether it be your own store, Amazon FBA or eBay comes with a unique set of challenges and issues.

In this video, Isaac talks about how he unknowingly made a few technical mistakes which ultimately got him banned as an Amazon FBA seller.

Instead of wasting time, Isaac chose to bounce back and start over again on another platform.

In another FBA horror story, a seller’s account on Amazon was shut down because of one complaint from a buyer. It was an exceptionally successful business. The seller made it to the top 15 media sellers on Amazon selling used media. They were regularly selling 5000 items per day and later expanded that success to Amazon by selling private collections of DVDs when resale prices for CDs plummeted. At the time it was untenable to have a warehouse or scores of employees in this business and switching over to Amazon solved the problem as they provided a warehouse and took care of customer service and delivery at a fraction of the cost.

But one fine morning they woke up to an email stating that their Amazon account was permanently closed. The reason given was the Seller Central suspected that they had sold a counterfeit DVD.

There was no appeal process. No explanations were requested. Just permanent closure.

When you’re faced with problems such as these, only perseverance can help you get through.

At other times, a particular payment processor might shut you down or you might face heat from Shopify as described in this situation.

The seller waited for weeks to get payment cleared from Shopify but to no avail.

After two weeks, Shopify sent an email pinning the blame on the seller’s bank who said that there was no attempt at payment from Shopify.

It wasn’t the seller’s fault that the payment didn’t get processed. But the payment processor Shopify is far from accepting the mistake on their end.

Such hold-ups in payment may severely affect cash flow and you must be prepared for eventualities such as these.

Facing the competition

As an eCommerce store owner you’ve got to compete against retailers both offline and online. There are also unsavory manufacturers of the products made worse by cheap replicas flooding the market.

It isn’t easy.

Access to products from manufacturers is easily achieved and as such there are hundreds of people competing for a chance at a slice of the pie.

As an entrepreneur, it is your task to come up with creative solutions to such problems.

Despite manufacturers and retailers competing with you, there’s ample opportunity to make the value proposition attractive to the buyer.

Things like customer service and free shipping over a minimum purchase value and guaranteed free returns are things that go a long way in retaining customer loyalty.

Creating a good customer service experience also implies that your inventory is always filled to the brim.

Imagine a customer comes to the site hopeful of a purchase only to discover that the product’s no longer in stock.

That’s why you must be obsessed with cash flow. To run an eCommerce business, you always need to have cash on hand to purchase products beforehand. Stocks should be available to make available any large orders.

You can’t make excuses.

People value experience more than always trying to get the better deal for themselves. If you can win on experience, you can retain customers.

Only an entrepreneur can come up with creative solutions to such problems.

Concluding thoughts

You’re not an eCommerce store owner; you’re an eCommerce entrepreneur. Most courses teaching eCommerce weave a fable around it and show sky-high earnings.

But these stories neglect to tell about the scores of failures and mishaps that’ll beset your path. Having the right mindset and preparing for all eventualities will help you respond with greater flexibility.

E-commerce isn’t any different than life and comes with its own challenges and troubles in the form or returns, angry customers and unique challenges.

Plasticity of mind to deal with each issue is what will set you apart.