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Monday, January 11, 2016

Food For Thought About Online Stores

The other day I was visiting my local stamp dealer to pick up some supplies and something struck me. There was a box of modern Canadian mint stamps with a sign above the box that read:

"Mint Canadian Stamps  - Double Face Value for Each"

We often hear that one of the major advantages of an online store is the fact that there is no "rent"the way that there is with a bricks and mortar store. While that is indeed true, it has become very apparent to me over the last several months, that there is a hidden cost to online stores that never gets talked about. What is that cost? It is labour. Online stores are way more labour intensive to operate than traditional bricks and mortar stores. Why is this?

The main reason has to do with the fact that a customer cannot physically rummage through your stock in an online store. My dealer was able to take a bunch of cheap stamps that are too much work to sort out, catalogue and list and simply throw them into a box and let his customers do the work for him. All he has to do is ring up the purchase once his customers have selected what they want.

There is no way for me to do this. I have no choice but to do the work of sorting this stamps, grading them, putting them into stock, pricing them, scanning them and listing them. All of this takes a tremendous amount of time. The result is that some stamp lots that my dealer friend would be happy to buy I might have to turn down as the labour cost associated with processing them is too high.

It is something to think about if you are thinking of starting an on-line store. Of course, I chose to go thee online route because you can't beat it for market reach and traffic. But I wanted to point out that an online store is not "free" or "near free" the way people might believe.


  1. 1/2 way through January. How are sales? All set for increase in staffing? Have you adjusted your forecast for this move?

  2. This is a slow month so far and has been triggering my apprehension. I keep telling myself that people are just spent out from Christmas. Plus the exchange rate is not helping. However, I'm all ready for the growth of my team, and am optimistic that sales will increase in the coming months.