An Internet mail order business is similar to a traditional mail order operation, only the Internet is the source of business instead of a printed catalog. This idea is a simple and straightforward business that you can operate from the comfort of your home. If you run the operation professionally while using the right tools and services, you can make money consistently with an Internet mail order business.
The secret to all direct marketing (and mail order is direct marketing because you are dealing direct with the customer) is testing. If you stake all on one product, one advertisement and it fails, you have nowhere to go. The secret is, therefore, to develop a test programme before you even start. This doesn't - thanks to the Internet and sites like eBay - have to involve a lot of cash. But remember, if you don't know what you are going to do next in the event that your initial effort fails, you may be wasting your money.

Picking a product or service to sell
Isn't this the first step in starting any business? The types of items and services sold by mail order run the gamut from hand-crafted items to advice-giving newsletters to antiques. But how do you pick something that stands a chance of success?

Most experts agree that the items you offer for sale must be unique - and unavailable. Why? If your product is a one-of-a-kind, it has appeal for buyers. And if you can purchase the product at the local supermarket, why order it through the mail? If you can't find something unique, you need to be able to sell it for less than anyone else.

When you have a few items in mind, you'll need to evaluate them. Here are a few questions to ask of each product or service to determine which one or ones you'll sell.
  Does the product offer benefit to the buyer?
  Is there a large enough market of potential buyers for the product?
  Are you knowledgeable about the product or can you become knowledgeable?
  Are there any similar products already on the market?
  Can the item be competitively priced and yet bring enough profit to justify its sale?
  Can the product be easily shipped?
  Do you have a source for the product?
 

Your website - keep it simple
Establish a simple website capable of listing all of your mail order products for sale. Choose a web host that charges a low monthly or yearly fee to keep your costs at a manageable level. You can use an online payment service that allows you to create payment links for your product description pages or purchase a full shopping cart software program. In the latter case you also need a merchant account provider.

Locating suppliers
Do you have a source for the product? This final question in your product query is pivotal. Where will you obtain your product? You may already have determined that you'll manufacture the product yourself. This might include items like crafts, 'how to' booklets or your very own invention.

If you intend to produce the product yourself, you'll need to address a number of issues - such as where will you secure your supplies at wholesale prices, if possible?

Are there any laws that apply to the manufacture of your product, for example planning restrictions if you're working at home, food-safety rules and so forth?

If you've decided that you'll purchase your product and resell it by mail, you'll have to locate sources. Keep your eyes open for the products you're interested in. Look at catalogues and at retail stores. Attend trade shows and read trade magazines. Then contact the manufacturers of the products you're interested in direct.

Pricing your product
To determine your selling price, you'll first need to calculate the actual cost to you of buying (or producing) the product. Your actual cost will include all raw material, start-up expenses, shipping, packaging, labour, overheads and advertising.

Now you'll need to determine what your profit should or could be and what your target market is willing to pay. Many companies in the mail-order industry use a mark-up of 200% to 300% of the actual cost of the product. But you won't want to charge more than your target market is willing to pay.

Basic business 'stuff'
The following 'business start-up' issues, among others, must be addressed as you put together your mail-order enterprise.

Your business name. An important first step for any business, the task of creating your business's moniker involves telling the public what you do in an unforgettable way but in as few words as possible.

Credit-card merchant account. The ability to accept charge cards for payment is crucial to your business. Start with your local banks; if your personal credit is good, you may be able to acquire a merchant account through them.

If not, try an ISO (independent sales organisation - essentially, a go-between that exacts a fee from you for their services). Remember to shop around for your merchant account, compare prices and always read the fine print.

Business plan. You've heard it a thousand times and, yes, you do need a business plan, even if it's a very informal one for your eyes only (although, if you're attempting to secure a merchant account or start-up financing, you may need to make it a formal document to be shared with bank officials.)

Over and over, studies prove that businesses that fail to plan are, essentially, planning to fail. Putting together a business plan is crucial to your business's survival.

Your plan should include at a minimum: an Objectives and Business Description (detailing your business concept and its goals), a Product/Services Description (the items you're offering, why they're marketable etc.), Operational Details (who your suppliers are or how you'll produce items if you intend to manufacture them), your Financial Plan (including estimated start-up costs, pricing information, sales estimates etc.) and your Marketing Plan (see next section). A brief one- or two-page summary of the plan's elements should be included after the cover page and before the formal plan.

Your marketing plan
This is one of your biggest start-up steps as a mail-order entrepreneur - and the element that truly sets mail order apart from other types of business operations. Your marketing plan will determine how you connect your customers to your product.

The first query of your marketing plan is: Who are your potential customers (your 'target market')? Are they business people? Teens? The disabled? The elderly? Teachers? What are their needs? Why would they want to purchase your product or service?

The next section of your marketing plan will describe how you intend to reach that target audience. With mail-order businesses, the methods of marketing have blossomed in the past decade.

Years ago, the traditional approaches for mail order were classified advertising (at the back of magazines or newspapers) display ads and direct-mail solicitation. Bigger press advertisements, inserts, radio and TV ads were also possibilities. Nowadays you are most likely to advertise your online mail order business using a cost effective online advertising service that allows you to target specific groups of buyers with text and image ads. You can target your advertisements to reach your specific set of target customers. Also, integrate search engine optimization into your web design to bring traffic to your site.

There may well be a place for magazines, newspapers and other media in your ad strategy, and you should contact the relevant  advertising departments and ask for their media pack.

Whichever methods you want to include in your marketing plan, your ads need to be well written and placement (the venues you use to advertise) should be well chosen to reach your target audience.

Your next task will be to write 'copy' (the ads themselves) that sells. Draft some ads listing the persuasive selling points of your products - perhaps with introductory or 'limited time' offers - and then test them on family and friends. Remember, I am always happy to run my eye over copy, as is Sue Waddington, our resident copywriting guru.

Try them out in selected publications and then see what kind of results they bring. You may need to change your copy, your publication - or both - for success.

Consider also using a free or low-rate phone number. Studies have shown that prospects are seven times more likely to call a low-rate number than one they'll be charged for. Shop around, compare rates and read the fine print.
 
Fulfilling orders
Once you've contacted customers and secured orders, you'll need to keep your end of the bargain. Fulfilment is the process of securing and shipping goods to the customer who's ordered them. If you produce your own inventory or you've purchased goods for resale, you'll be responsible for packaging and shipping.

Sign up for an online account with a shipping service that allows you to print despatch labels from your computer. Choose the most economical shipping method for your standard service and offer a premium first class service  to shoppers in a hurry.

A dropship arrangement is also possible, where you arrange with the manufacturer to ship direct to the customer. However, I would urge caution with regard to dropshipping. The companies involved are often unscrupulous and may also not be that efficient.

Taking care of business
With fulfilment of your mail-order business's purchases, the marketing loop is complete, right?

Yes and no. Your successful business will include the ongoing issue of customer care and service. Satisfied customers will keep buying - and they'll tell others about the experience.

Other elements of your business are also ongoing. Changing your mix of marketing methods is important as you determine which approaches work best for which products. Adding and/or eliminating products may also be good for your business. Tracking results of various advertising efforts is pivotal.

If your approach to your start-up steps - and your follow-up tasks - is professional and earnest, the sky is the limit for your mail-order operation.

 

Tips for your website Provide an email option Include your email address on all correspondence, business cards and other company documentation. You can ask current customers for their email addresses or you can rent an email list online. Type in 'email lists' for your Web search to find sites that sell lists. However, do be cautious - many email lists are not very effective. If you can get 20% of them to open what you send out you are doing well... and when it comes to actual orders response is likely to be very low.    Content Pack your website with clear, interesting and accessible information about your products/services along with a frequently asked questions (FAQs) section. New products, sales information, seasonal products etc. also can be quickly publicised with a website.    Collect leads Creating a guest book and asking website visitors to sign in before gaining complete access to your site is an easy way to build a quality email list.    The full-blown e-commerce site This incorporates shopping-cart technology and encrypted credit-card processing and will give you a virtual online store. But this type of site really only makes sense if you have a number of products to sell or you're planning a catalogue of goods. Start out with a more modest site to see which makes more sense for your business.    Online malls Signing up for an online mall. Another approach to the online-sales equation is to sign up as a tenant in an online mall. Online malls are the virtual counterparts to bricks-and-mortar malls, typically offering a number of 'departments' to choose from, advertising and promotional services and even shopping-cart technology and order processing.    There are hundreds of online malls on the Web - from giants like www.netmall.com with over a quarter of a million tenants to small, regional malls - and they offer a vast range of options for small businesses. Prices can be as low as £20 yearly for a simple listing and can run as high as several hundred pounds monthly with all the bells and whistles.    Thoroughly research what these marketing vehicles offer before signing up. Ask for a free trial period - or at least ensure that you can terminate your arrangement if results are not forthcoming.    Use eBay eBay has been around a long time and has moved away from its auction roots, But it remains a fantastic facility for anyone wanting to get into mail order. It is cheap to test. You can always include a 'buy it now' option. You can set up your own 'shop' as part of the eBay site. You can count on them to get your product listed with all the search engines, like Google and yahoo. Really, eBay should be a large part of your marketing strategy.

Tips on dealing with vendors
If you are going to be purchasing a lot of products or goods to sell on your website, don't forget to check out the vendors. You don't want to throw your money away; so do your homework.

1. Do an online search. Check that the company has a good reputation and that there has been no bad publicity.

2. Ask the company to supply references. If they suggest that their distributors or dealers can make £XXX a year, ask them to supply the names and addresses and phone numbers of some people who did just that. If they can't product a list of satisfied customers, look elsewhere for your pot of gold at the end of the rainbow.

3. Make sure you have a very good idea of what you are purchasing. It's important to feel comfortable about the products you will be selling. Make sure you understand what it is. Some companies are great on the sizzle but fail to provide a steak that you can resizzle and sell. If a company is too vague, for your instincts, find a new business opportunity in which you can invest.

4. Inquire about follow-up and support. It's important that you understand whether or not the company from which you might purchase your business opportunity will be available to answer questions in the future. Some are, and some do not provide this service. Some provide it, but for a fee. Understand what you are buying.

5. Ask about accessibility of future shipments and turn-around time. If you are investing in a company which will require that you purchase additional inventory or minimum orders, ask them how long they take to fulfil orders, how they ship and whether they are available on weekends etc.

6. Make an appointment to visit the facility or headquarters. Ask if you can visit the company's headquarters. If you get the run around, it means something is not right. If they welcome you to visit, you are one step closer to finding a good business 'partner'.

7. Use your instincts. Many people say, "If it sounds too good to be true, it probably is." We completely disagree, because we've seen incredible successes come from as little as an investment of £50. We say, "If it doesn't feel right, if the company with whom you are about to do business arouses your suspicious instincts, something could be wrong." We've evolved a long way from our cavemen brothers and sisters, but they relied very heavily on instinct for survival. When it comes to starting a business, it is necessary to conjure up this sixth sense known as instinct and use it.

8. Stick to it. No matter how slowly the business seems to move in its way to development, stick with it if you believe you have a great product to sell. Create a timetable and if you have made a mistake and misjudged the market know when to cut your losses.

In conclusion
Here's one final and crucially important mail-order tip. Remember the value of a niche market. It is easier to sell something to a small number of highly motivated, enthusiastic, easy-to-identify customers. What you lose in volume you should gain in lower costs and higher margins.