Creating an online retail store (website) that would serve as a one-stop shop for online shoppers to meet their computer accessories’ requirements.

The customers should be able to compare similar products from different companies, and determine the most competitive price available.

The business would consist of Business-to-customer segment as well as business-to-business segments.

The product portfolio can include some of the following computer accessories, classified under various heads:

Systems: - a. Desktops b. Laptops/Notebooks c. PDAs etc.

Hardware: - a. CPUs/Processors, b. Pen drives, c. Flash drives, d. Modems, e. MP3/MP4 players/iPods, f. keyboards, g. DVD drives/burners etc.

Software: - Various software and related books.

The various categories would display the products under different brands, with their price listings.

The website must also have pages for customer service agreements and other terms and conditions.

Online retail has been growing well over the last few years. Figures show a bright opportunity for entrepreneurs in this segment. Last year online retail sales grew by 25% to hit a figure of $175 billion. Non-travel segment online sales grew by 28%. Reports forecast a further growth of up to $200 odd billion figures. There maybe a temporary bottleneck if recession sets in. Computer hardware and software products are the second hottest products to be sold online, after travel services. Forecasts for last year itself were in the region of $16 billion.

If a website enables a customer to make informed buying decisions, and offers him/her a wide variety of products, at competitive prices, then the customer would prefer to shop from that website, rather than venturing out into the market looking for a good bargain.

Established sites like Amazon and eBay, pose significant competition for a start-up. But the brighter side of the story is that according to the 2007 Forrester research, small websites drive 1/4th of online retail revenue.

A few popular sites in the online computer stores market are:

1. NewEgg
2. Tiger Direct
3. Amazon

While these sites are famous for their customer care, computer hardware selection, and competitive price offerings there are two other sites that are famous for product comparison, they are:

1. PriceWatch
2. PriceGrabber

Promotion activities should be based on value additions that the business can deliver to customers.

1. Discounts can be one of the most attractive promotional for online shoppers. A credit point system can be introduced, where every purchase adds to the credit bank of the customer and the customers with higher credit balance in their accounts, can liquidate their credit points to avail discounts.
2. Advertising the website in technology magazines.
1. Displaying products/services at auction sites.
2. Placing ads with local newspaper classifieds.

Apart from these, ads can be placed in related blogs, affiliate promotional programs, direct emailing can also be used.

The primary source of revenue would be the margin that can be made as a trading intermediary, between suppliers and customers.

Tapping the business-to-business segment, by tying up with companies, to fulfill their accessory needs at attractive rates. Allowing monthly credit facilities would help lock in a substantial customer base.

Since promptness of delivery is one of the crucial aspects that determines the quality of service, good logistics arrangements is a must. There has to be a minimum investment in inventory and arrangement with suppliers for delivery of the products within the stipulated time.

Customer interface: The website would display catalogues of various accessories under different categories, and would list the most favorable price for a particular item. The customers would require registering with the site.

Supply chain management: Signing up with local distributors, who could serve as selling portals.

While an inventory of the top selling products needs to be maintained, the business would primarily leverage on the inventory of suppliers, with shipment agreements.

1.Build a network of suppliers in the local market.
2.Maintain a database of various products. A team should be dedicated to maintaining it, because the accuracy of part numbers and other aspects of product description is extremely critical- a host of things like price, the product itself, and shipment etc. would depend upon the database.
3.The website would have to be created.
4.A logistic arrangement would have to be made for timely delivery of the products.
5.Agreements with suppliers, on margins and payment policies would have to be decided upon, so that benefits can be passed on to the customers.

1. Quality of products, popularity of advertised brands, cost benefits and promptness of delivery are crucial aspects that would eventually determine the success of the online computer accessories store. Failure on these aspects can prove costly.

1. Shipment of wrong products, problems in payment acknowledgement etc. can damage the brand image of the website.

1. A possible recession can mean a reduction in over all retail sales, especially of consumer durables like computers.

1. Making the website popular in the face of competitors like Amazon etc. is a tough challenge.

Over the years (in about a decade or so), as the brand gains in popularity, the business can merge with a bigger online retail store by liquidating stakes. The business owner(s) may require venture assistance, as the business expands. This can be availed by diluting a portion of their stakes.

• Focus on promptness
  of delivery.
• Reliability of
  brands.
• Variety of choices
  for customers.