How to start E-commerce business in Pakistan? Part-1

It is very impressive how Pakistan is progressing in the field of IT, telecom and broadband penetration. Pakistan’s e-commerce market is growing tremendously and presents great opportunities for everyone.

Pakistan’s broadband penetration has grown to over 40 million (38 million are on 3G/4G), up from just 2 million in April 2014. With more than 45 million smartphones in the market, Pakistan is on track to become one of the largest internet population in the world.

Foreign players and giants like Alibaba group are planning to enter Pakistan’s huge potential market. It is still a rising market and there is a massive potential for small businesses alike.

Why e-commerce?

E-commerce has several advantages over the traditional physical business. A few major benefits are:

  • Low investment as compared to a physical business
  • Can target a wider audience
  • You can start business immediately

Physical vs Online

For a physical business initial investment is huge. You need a place, a shop or an office. If you are going to buy it will cost you millions. If you go for the rental, you will still have to pay a considerable amount in advance and your monthly operational cost will be high. Then there are other one-time costs involved like furniture, lighting, and other stuff. You have to spend a big amount even before you start selling.

As compared to starting an e-commerce business you just need to buy a domain and hosting or go for platforms like Shopify or BigCommerce. You can get your site developed at very cheap rates from freelancers or if you are a power user then you can set up your own site that will cost you free. Few ready-made solutions that are available are:

  • WordPress/WooCommerce
  • OpenCart
  • Prestashop
  • Magento

There are even lot of other solutions available that you can search and try. If you do this on your own it will cost you free.

Setup and Operations cost is low

The next step would be to enter your inventory in your e-commerce store. That shouldn’t take more time. It could even be done sooner than setting up a physical shop. Due to this, you can start an online business immediately as compared to a physical store.

Target wider audience

If you have a physical store then you can target only the people in your area or city depending on where you are located. If you are a small businessman with a shop in your locality, your customers could only be from your nearby areas. If you have a shop in a bigger mall or market then your audience would be wider. But if you open an online e-commerce store you can target not only your city but your country, or you can even go international, resulting in huge potential for great revenue.

This is just the tip of the iceberg. But remember you must have some business sense since an online store is also a business. Without business strategy and marketing since you won’t be successful.

In the coming episodes, we’ll talk more about setting up an e-commerce store, the role of technology, business and marketing tips, how to grow your online business and much more.

If you feel this is a good read and want to read more about a topic you are interested in then feel free to leave me feedback and I’ll add it to my upcoming topics list.

Stop before start – Startup lessons learned!

I have gone through several experiences and ups and downs in my career. One was launching a startup which had a significant impact and the reason for me to write this post and to share the lessons learned and why we should stop on a starting line for a moment before we run.

Starting line

It was a long day back in February 2014. I was looking at the e-commerce industry of Pakistan and was surprised and happy at the same time that Pakistan’s e-commerce industry has been growing rapidly in past few years. The payment method was the biggest hurdle in Pakistan for the e-commerce industry and after the introduction of Cash On Delivery (COD) e-commerce market grew exponentially. Logistics companies like TCS, Leopard, and other played a significant role by offering COD services to businesses that eases the operation of shipping and payment for local businesses. That was the aha moment for me and I decided to launch my own e-commerce business.

The ground

I had been developing e-commerce solutions for some time and I had enough experience to run the show and grow it. The question was what am I going to sell?

At that moment I decided to share my idea with my long-time pal and cousin. He was also looking for a breakthrough in his life. When I put this idea in front of him he immediately agreed to dive into it. So, we started planning and thinking about what should we sell and how to arrange the inventory.

Let me mention here that one big problem with us was funding and our aim was to start with minimum investment. In fact, in the back of our minds, we were thinking to go with zero investment. This was something that I previously had done so it seemed possible with some teamwork, hard work, commitment, and time. We had to wear so many hats at the same time.

A mix of skills, the good thing

Ultimately, we decided to go with apparel to sell. What we actually did we mixed experience and fields of our both. I was an expert in technology and especially on the e-commerce side and he had experience in selling unstitched clothes. So we decided to go with selling clothes where he will take care of vendors, inventory, shipping (since he was also in the transport business so it was best that he handle delivery as well) and related stuff. While I was responsible for the technology side, plus customer service and sales, digital marketing, and everything that comes in between and belongs to technology.

The launch

We moved forward and in March 2014 we launched our website and started marketing on social media. Let me mention that since my partner was already working he started part-time. This was an important decision. My opinion at that time was if you have enough savings to run your kitchen for ideally 6 months or at least for 2-3 months then we can focus on our business full-time. Because we didn’t have investment so time was our investment. As much time we could put in we had to, in fact, we must otherwise I could see what’s going to happen. My partner was already in and there was no going back so we kept moving forward.

I realized early in the stage that we need more team members since we were not able to give full time. On the other hand, we were not in a position to hire anyone at this stage due to a lack of investment. I decided to include another partner and give him a share and my first partner agreed. I had a perfect guy in my mind and we put the proposal in front of him. Just like my first partner, he was also looking for a breakthrough in his life and he also showed interest in the first place. He was in and we started working.

I found a vendor who was actually my friend working in the same field and we agreed to do business with each other. So we had some initial inventory, we started taking photos, doing Photoshop, uploading on the website, and started posting on social media. So far so good, but the second partner started showing less interest and in May we were back to two partners.

The moment of joy

At the end of May, we were rewarded for our hard work and we received our first order. We were excited. We kept our heads down and arranged the inventory and shipped the order.

In June, there was more joy for us. We received our first international order and a good one. We were so excited that our primary market was local but I had been planning in a way to expand it internationally and it did work and we got our very first order from abroad. Awesome!

Turning point

failureWe continued and we started getting more orders but the turnaround time was slow as usually is in starting phases. This was the point where we had to make some more tough decisions but things started to change. We were still not in a position where we both can run our kitchen from the income of our startup. In contrast, our business was demanding more time, more effort, and investment at this stage. None of which we could do since we had to run our kitchen and in parallel support our startup. And we had nothing to put in. Ultimately, we were nowhere, we were short on inventory, our orders got cancelled, and thus no returning customers and no sales.

Then the day came when we took the biggest decision in July. We decided to wind up and in the loss. Fortunately, there wasn’t enough investment so our loss was also not that big and we bore it somehow.

Lessons Learned

We learned lots of lessons. To start a business you must have enough investment to run the show for a year at least including your kitchen. Due to a lack of investment and in return lack of marketing, team, resources, suppliers, and time (due to part-time work) we were unable to survive. People can quote you numerous examples and I myself know some but all they have is an investment in some context. I read an article that how WD-40 was named. It was actually the 40th formula that got successful and 39 formulas before that all failed. So, the creator of WD-40 had enough time and money to keep experimenting with his formulas and keep supporting his family and kitchen. That is also an investment.

One might think why didn’t we find any investors? Actually, startup and entrepreneurship culture is booming in Pakistan but still, there are some hurdles and the ecosystem is still not there yet. Good investors are hard to find on a profit and loss basis. So we were up to our own.

On the other hand, approach and lack of skills were also major issues. One man cannot do everything so all the partners have to contribute. They should have a ‘Can-Do approach’ and should be able to initiate ideas, and know how to execute them. Skills in a particular field are also very important. But working in some field doesn’t guarantee that you have skills in that field. At the same time, you have to bring and apply your previous experience. Plus, communication skills and self-confidence are a must to achieve something. You should be a problem solver too. Unable to think and coming up with no ideas in problem times is one of the biggest problems itself.

WooCommerce Per Product Shipping Price Calculation

If you have different rates depending on the item you will need to set up each one in the ‘Flat Rate‘ shipping method and ensure it is selected on the Product itself.

First, you will need to have a Shipping Class setup:

Go to the menu on the left hand, under Products you will find Shipping Classes.
Give your Shipping Class a name and a description and then hit “Add New Shipping Class”

Once that is done you can go back to the Shipping Setup, Under WooCommerce Settings.

Click on Flat Rate and at the bottom of the screen click on “Add New Rate”
Choose your Shipping Class.
Give it a cost and a handling fee.

Why will you need separate shipping classes?

Imagine you sell small items but just so happen to have one large item you want to sell on your site. You obviously cannot charge the same as you can with the small items.

Add Manufacturers in carousel box in OpenCart

The default installation of OpenCart has the brands/manufacturers displayed in a carousel at the bottom of the home page. Updating the manufacturers in Admin->Catalog->Manufacturers will not affect that. If you want to change this you’ll need to update the manufacturers’ banner.

To update the banner go to Admin->Setting->Layout->Banner. Here you can update the Manufacturer banner to display the manufacturers you want.

Some people don’t know this and try to play with Carousel module or Manufacturers in Catalog, but they have to update the banners in system layout.