The Side Hustle 02: What does success in ecommerce look likeJul 26, 2023
Reading time: 2 mins and 20 seconds.
Welcome to the second edition of The Side Hustle. Apologies, this one is four days late. I was at Online Retailer in Sydney last week, and spent the weekend catching up with the family.
Today I want to talk about success in ecommerce.
Let's start by breaking down what it means to be successful.
Success is a subjective, topical idea. Some people define success by a certain dollar value they're worth, for example, I’ll be successful when I’m worth ten million dollars, or when I earn three hundred thousand dollars per year.
Others see success as the sale of their business for a certain value. For others, success can mean creating a legacy business or brand that pays for their lifestyle, and allows them to do something they consider fun, or rewarding in some other way.
There’s no right or wrong, by the way. That’s the point of being subjective. However, as business owners we should think about it, as it can shape our strategy.
In case you’re wondering, my idea of success for myself is building something that allows me to financially leave my children in a great place, while being able to afford to take time off during the week to spend time doing fun things with my wife and kids. I also have no intention of taking an ice bath at 5am each morning, or raising $100m to disrupt something.
So, with that goal in mind, my idea of success needs to be built with something passive, automated and scalable.
When it comes to ecommerce, too many business owners think about success as the end goal; I will work my butt off and then sell for a load of cash and then I can relax. I’ve got some bad news for you - that rarely happens, and if you’re not enjoying life as an entrepreneur now, that’s unlikely to change, unless you and your business change. The reality is, if you haven’t built something that’s already looking after you financially (and mentally) while you run it, there’s very little chance that when you go to cash it in, you’re going to go from zero to hero.
The moral of that story is, you should try and run your business as though you’re going to sell it, although never expecting to actually sell it.
I love a good juxtaposition. Let me break that down.
If you run your business as though you’re going to sell it, it means you’re going to focus on knowing your business and its numbers and processes inside out, you’re going to have a scalable business built on process and automation, and you’re going to try and show as much profit as possible, with the cleanest books possible - because those businesses sell for the most, and let’s face it, you want to look squeaky clean going through a due diligence process.
If you run your business as though you’re never expecting to sell it, it means that you’re also forced to realise that this business of yours is likely to be the hand that feeds you for the foreseeable future, and therefore you need to make sure that it’s generating profit enough to serve your needs.
The inputs into both of those outcomes should be the same. Work towards running a highly profitable, lean, cash positive business.
Ultimately, there’s no right or wrong strategy. If you’re going all guns blazing towards what you expect to be a huge exit - then go forth, with your eyes wide open. Although, in my experience, that can be a little stressful. I don’t care who you are, when you’re burning money, it’s never a good feeling. We’ve seen plenty of these unprofitable models fail over the years, or deliver poor returns for investors ultimately.
If you’re trying to be highly profitable, and generate cash to improve your life, then it’s likely that you’ll be focusing on profits, by selling as much full priced product as you can, while controlling your spend. Not terribly complex is it?
You know where I stand - what does success mean for you?
If you want to work with me, here's how:
1. Ongoing advisory - Fully booked
2. 1:1 Coaching - Coming soon (email me at [email protected])
3. Group coaching - Coming soon
4. Webinars - Coming soon
3. Shopify Start - My online course that teaches beginners how to use Shopify
4. Ecommerce Start - My online course that teaches people how to start an online business and turn a profit in less than 3 months.
5. Ecom Nation - Digital marketing for your business
6. Buy my book, Shopify for Dummies
7. Pre order my book, Selling Online for Dummies
8. Speaking or conferences: Email me at [email protected]