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Online Vs. Brick-and-Mortar: What's Right for Your Small Business?

August 20, 2018 - 11:01 am

A small business can take many forms, and its sales platform, whether it does business exclusively online, in-store, or a combination of the two, can mean the difference between success and failure. When deciding which platform is the best for your small business, the biggest factors to consider are location, product, and consumers.

Demographics show that preferences for brick and mortar and online shopping vary through age groups, men and women, and location. Brick and mortar still holds the highest sales volume, while online shopping is currently growing. There are challenges with either business model. The choice hinges on business goals, desired customer base, and location.



The biggest advantage of brick-and-mortar is the shopping experience. People like the idea of talking to knowledgeable sales staff about products, shopping with friends, testing out products prior to purchase, and easy returns. Consumers like the social interactions, and the ability to have the product same day without extra costs. The quality of staff is vital for a brick-and-mortar store to thrive. Sales staff become the face of the store and its value to the community.

Rural America prefers brick-and-mortar over online shopping, followed by city dwellers, then suburbanites. The challenge is to create an environment that is inviting to customers, meets your financial bottom line, and keeps up-to-date with the industry. Location of the store is very important for developing a new and return customer base. It is vital for a brick-and-mortar to balance sales with costs.



The advantage of online shopping is convenience. It's available 24 hours a day, and transactions can be completed in the comfort of one's home. The social interaction is minimal, and it is easier for shoppers to stay focused on their intended purchase. Online allows a small business to offer more products than a brick-and-mortar store. The challenges are to meet the same-day shopping experience of a brick-and-mortar store, and the ease of returning products.

An online business is less expensive to run due to the overhead being confined to warehouse space, store products, and staff to fulfill the orders. This requires less start-up money for the new business. Marketing becomes one of the greatest challenges so that customers can find your business.



The last option is to offer your customers a combination of a brick-and-mortar and online shopping experience. The business that can successfully combine these has the potential of great success. This model gives the convenience of shopping at home after a customer has visited the store to test out a product. These businesses cater to all shopping styles and increase their potential pool of customers. The advantage of establishing both a physical store and an online presence is being able to offer either in-store pickup or shipping. These options appeal to customers. It increases their trust in the company and can make returning products easier for the customer.



This article was written by Karen Ulvestad for Small Business Pulse