By 
Gone are the days when physical outlets used to have a monopoly over the consumer world. Online shopping and e-commerce stores have also become viable shopping options for consumers.
That said, physical stores continue to dominate in the total number of sales. But with the coming of COVID-19, easy availability of business loans, and the general ease associated with purchases, the popularity of online stores is accelerating by the day.
So, if you are thinking of starting a business, you might be torn between the traditional brick-and-mortar way and the new digital way.
Worry not, here’s a comprehensive comparison between the two to help you out.
Location
E-commerce obviously wins in this category, as you aren’t bound by the location of your store, something which physical stores grapple with. As a result, you can cater to customers spread over a wide geographic area.
In contrast, physical stores have a relatively narrow geographical demographic to work with. Plus, they also need a high initial capital to buy the store space or rent it. And if you’ve taken a loan, paying the business loan interest rates along with all the expense can be challenging. But if you’re drop-shipping in e-commerce, you won’t need to buy or rent warehouse space. So, that’s another bonus if you wish to build an e-commerce store.
Transactions
With increasing adoption of digital wallets, transactions are more or less similar for both physical and e-commerce stores. However, the addition of cash payments for physical stores makes them somewhat safer than online ones that don’t offer the cash-on-delivery option.
However, online stores today do have tie-ups with many banks and credit/debit card companies, through which consumers can either save money or receive rewards.
Operating expenses
Physical stores will usually have higher operating expenses since you’ll have to take care of rent, utility bills, maintenance, employee wages, and more.
With that said, e-commerce stores also come with their fair share of expenses, including web and app hosting fees, shipping costs, advertising and marketing, etc.
If you’re starting a new business, these expenses can feel quite burdensome initially. However, with affordable business loan interest rates on loans today, you can cover these expenses without breaking a sweat.
Connections
As you can’t see your customers in person, you might have to spend a lot on marketing when you’re running an online store to make a connection with the audience. Some of the best media include email, social media, search engine marketing, and advertisements.
Physical stores have it easy in this category. Though they still have to promote their business with marketing, the walk-in aspect of brick-and-mortar stores allow you to have face-to-face relationships with your customers.
Your turn
When it comes to physical stores vs online stores, there’s no clear winner. It all depends on the product you’re trying to sell, your business goals, and the funding.
Talking about funding, whatever you choose, you can always fund your business vision using a loan. And with simple business loan eligibility, easy accessibility, and fast processing times today, you can easily fund any business, be it an online store or physical.
Just use a business loan EMI calculator to estimate the probable costs and plan for your venture.
Comments