5 Things To Consider When Selling Physical Products

Planning to be a business owner where you sell physical goods?

That sounds great! You’ve bravely taken the first step in your entrepreneurial journey.

But starting a business isn’t all sunshine and roses. There are things you need to consider too.

Here are 5 things you need to take into account when selling physical products.

Also, check out the things you need to consider when selling digital products.

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1. Physical Or Digital Store

The first thing you need to consider is the cost of your shop.

To sell your goods, you’ll need a store. This is where you can display your merchandise, let your customers try them on (eg. clothes) or interact with the goods and buy the products.

If it’s a physical store in your local neighborhood, you’ll probably need some capital to pay the lease upfront. Some customers prefer in-store shopping because they enjoy the experience and don’t want to pay the shipping fees.

You can, however, reduce this cost by creating a digital store on Etsy or social media channels like Facebook, Instagram and TikTok.

Whether you’re setting up a physical or digital store will depend on many factors:

• Type of products you’re selling
• Target audience
• Monetary amount you can invest
• Operating costs
• Manpower and resources
• Barrier to entry

Do some research on the industry landscape and analyze your competitors. For instance, you can now sell clothes online and offline. In fact, some fashion blogshops started small by selling clothes online before expanding and having their first physical store.

The key is having a goal then planning the specific steps to get there. Remember to note down all the costs incurred for setting up a store, including the monetary amount, manpower and resources.

Photo by Artem Beliaikin on Pexels

2. Physical Products

Next, think about the goods you intend to sell.

Do you offer variations of your goods? For example, different colors or sizes.

Are they custom-made where it’s tailored to each customer? Or is there a fixed range and types of products?

Do you offer a range of products to cater to people of all ages and genders?

And one of the important considerations is whether you offer various price points. Personally, I feel that it’s better to have a range of prices. This way, you have affordable products, mid-range products and luxury products. But this highly depends on who your customers are and your brand image. If yours is a luxury brand, you’ll probably only have products at high price points.

If you’re just starting out, it would be wise to offer a few products first. This way, you can test the market demand. Expanding your product range can happen after you make a profit and have the resources to do so. In fact, you might offer this new product as limited time only to test the waters and leverage the psychological triggers of urgency and scarcity, aka fear of missing out (FOMO).

Aside from the research and development (R&D) aspect, do bear in mind the costs of producing the goods. One small tip: Always buy your materials in bulk. You can start small and scale up as your business grows. For instance, you could begin with 10 buttons and zippers then slowly increase this to 30 buttons and zippers.

Source: Ylistyle via Etsy

3. Inventory Management: Storing & Tracking

For physical goods, you need to think about where you’ll store your goods.

If you have a physical store, you can store your goods in the cabinets and drawers.

But if you own a digital store, you’ll need to seek alternatives.

If you have some capital or your brand is quite established, you can consider storing your goods at a warehouse. But if you’re just starting out, I recommend that you store it in your own house. Or only create the product when you get an order. This is also known as on-demand manufacturing. But do research the costs and compare it against bulk production.

Also, determine how you’ll keep track of your inventory (the quantity and movement) and whether it’s in real time. When you have a small quantity of goods, this can be done with a spreadsheet. But you might have to use inventory management software when your business grows.

Photo by rawpixel.com on Pexels

4. Shipping

Physical stores may or may not offer delivery services. But for most digital stores, they offer shipping services (rather than meeting face-to-face to deliver goods). Of course, you can choose in-person transactions when you’re just starting out.

If you offer shipping services, consider whether you’re selling your products locally, worldwide or in selected countries. Do state clearly which countries you ship to.

Next, check your local post office for postage fees, parcel weight and delivery times. Note that air and surface mail have different rates. You can also compare the various courier and postal services and see which is more affordable.

You can include this shipping fee in your product price or add it as an additional cost.

Also, do include a shipping policy on your website with information like

• Shipping details: domestic & international shipping options, shipping costs, delivery times, shipping restrictions, how to check order status
• Refunds, Returns & Exchanges: whether you accept returns, how many days after delivery can a product be returned or exchanged, how customers can return and exchange goods, how long it takes to process a refund
• Damages & Lost Packages: what customers can do, how they can report this, how to contact you

Update your shipping policy as often as required. You can also consider creating FAQ for popular questions.

Photo by Karolina Grabowska on Pexels

5. Packaging

If you offer shipping services, you’ll need to take into account how to package your goods.

There are various ways to package your goods depending on what the goods are.

• Rigid Mailer: documents, cards, artwork
• Bubble Mail: fragile items
• Carton: bulky items

Ensure that you measure the dimensions of your products first. Also, consider buying one first (whether it’s a rigid mailer, bubble mail or carton). After confirming that you can fit your product inside, you can then make a bulk purchase.

In addition, there are other packaging supplies like

• Stamps
• Labels
• Bubble Wrap
• Kraft Papers
• Kraft Tags
• Honeycomb Papers
• Foam Peanuts
• Tape
• String

When you just launch your business, you probably won’t have the capital to create custom-made packaging (eg. boxes or wrapping papers with your brand logo). If so, I strongly recommend that you include a “thank you for your purchase” card instead. Besides thanking customers, you can include links to your website or social media channels, contact information, call-to-action like writing a product review, subscribing to your newsletter or getting a discount for their next purchase. Again, remember to buy in bulk (especially if there’s a discount)!

Source: BRDesignsAndGifts via Etsy

Now It’s Your Turn

Do you have any tips to share with aspiring entrepreneurs who plan to sell physical products? What are some other important considerations? Feel free to add on and elaborate your thoughts and experience~