I know that most people will reply with a simple 'no' just from the heading but please hear me out. Here is my situation:
I live in Sydney Australia working a 9-5 as a system administrator at a local hospital. I've been learning programming on the side for the last few years with plans of changing jobs to become a software developer. Recently I've been considering pursuing my own online business of some kind and have had an opportunity present itself. I'd just like a bit of advice if that's ok.
My father-in-law has a engineering/hardware physical store which was quite successful a few decades ago but has now declined to the stage where it is barely profitable. He has been trying to sell it for the last 1-2 years with little interest due to the declining resource sector and a complete lack of advertising. (There could be other factors but as I am completely ignorant of business I'm not sure.) Also note that he is over 60 years old and his business partner is his uncle who is 90 and still comes in every day to work!
A couple of weeks ago he asked me on a whim about building a website to attract customers to the business. I said it'd be a good idea but that it might be costly to hire someone. I didn't say I could do it as at the time I didn't feel confident that I could do it justice. However after reading some things on these forums as well as other sites I think I could fairly easily build a Shopify site for the business and do some basic SEO to bring both in-store customers and some online sales.
One important note is that they currently don't do any postage sales currently so all their business is in-store. If we pursue online sales we'll obviously need to set that up the delivery as part of the business process.
I'm planning to present this to him as a low/no risk venture as the business is fairly cash strapped from what I know. I'm thinking that I'll sell it to him that I'll pay to get the site setup and monthly costs so there's no initial outlay for him. I'll make the money back by asking for 50% of profits from any sales made online. I'm also thinking of offering some sort of special which customers can bring in-store if they've seen the website and I'll take 50% of the profit from those sales too.
I'll leave all the postage aspects to the business but we'll obviously add postage costs to the order via the online store. This will really be all the extra work the business will have to take on.
I figure that we'll run it as a 6 month trial and re-evaluate then. If things are going well then I might take-over on a monthly fee for some SEO work/website updating. I'll need to make sure that my agreement is with the business as if the business is sold then the new owners will need to respect the arrangement.
Oh and also there's a pretty good chance that when they do sell the business will close as the buyers might only want the land/storefront.
Wow! Sorry about the long post! Anyway, here are my questions:
1) Do you think this business model is worth pursuing? Creating online stores for local small businesses? If this goes well I can imagine that my father-in-law would have a lot of referrals as he's pretty well known in the local area.
2) Are the risks of the business closing and the risks of working with family too great? I haven't discussed these ideas with him yet so there's the risk that he'll agree but not be too enthusiastic about it so I'll be forever waiting on him to provide content. Could be other issues?
3) Is the idea of me fronting up the costs for a 50% take of the profit from sales an ok idea? Having never done this before I'm not sure and would appreciate any advice
As a final note I'm at the very least going to talk with him about this as there's no risk to at least talking!
This will also be good practice for me in negotiating with clients and actually building an online store so I'm kinda ok with fronting all the costs even if I don't make any money from the site, though I would be disappointed if I didn't make anything. Is it too naive to think that I'd make some profit from my first online business project?
Anyway I'll leave it here. Please let me know your thoughts as I'm very very new to all this and am always trying to learn/improve. Any help is appreciated!
Cheers
Gabriel
I live in Sydney Australia working a 9-5 as a system administrator at a local hospital. I've been learning programming on the side for the last few years with plans of changing jobs to become a software developer. Recently I've been considering pursuing my own online business of some kind and have had an opportunity present itself. I'd just like a bit of advice if that's ok.
My father-in-law has a engineering/hardware physical store which was quite successful a few decades ago but has now declined to the stage where it is barely profitable. He has been trying to sell it for the last 1-2 years with little interest due to the declining resource sector and a complete lack of advertising. (There could be other factors but as I am completely ignorant of business I'm not sure.) Also note that he is over 60 years old and his business partner is his uncle who is 90 and still comes in every day to work!
A couple of weeks ago he asked me on a whim about building a website to attract customers to the business. I said it'd be a good idea but that it might be costly to hire someone. I didn't say I could do it as at the time I didn't feel confident that I could do it justice. However after reading some things on these forums as well as other sites I think I could fairly easily build a Shopify site for the business and do some basic SEO to bring both in-store customers and some online sales.
One important note is that they currently don't do any postage sales currently so all their business is in-store. If we pursue online sales we'll obviously need to set that up the delivery as part of the business process.
I'm planning to present this to him as a low/no risk venture as the business is fairly cash strapped from what I know. I'm thinking that I'll sell it to him that I'll pay to get the site setup and monthly costs so there's no initial outlay for him. I'll make the money back by asking for 50% of profits from any sales made online. I'm also thinking of offering some sort of special which customers can bring in-store if they've seen the website and I'll take 50% of the profit from those sales too.
I'll leave all the postage aspects to the business but we'll obviously add postage costs to the order via the online store. This will really be all the extra work the business will have to take on.
I figure that we'll run it as a 6 month trial and re-evaluate then. If things are going well then I might take-over on a monthly fee for some SEO work/website updating. I'll need to make sure that my agreement is with the business as if the business is sold then the new owners will need to respect the arrangement.
Oh and also there's a pretty good chance that when they do sell the business will close as the buyers might only want the land/storefront.
Wow! Sorry about the long post! Anyway, here are my questions:
1) Do you think this business model is worth pursuing? Creating online stores for local small businesses? If this goes well I can imagine that my father-in-law would have a lot of referrals as he's pretty well known in the local area.
2) Are the risks of the business closing and the risks of working with family too great? I haven't discussed these ideas with him yet so there's the risk that he'll agree but not be too enthusiastic about it so I'll be forever waiting on him to provide content. Could be other issues?
3) Is the idea of me fronting up the costs for a 50% take of the profit from sales an ok idea? Having never done this before I'm not sure and would appreciate any advice
As a final note I'm at the very least going to talk with him about this as there's no risk to at least talking!
This will also be good practice for me in negotiating with clients and actually building an online store so I'm kinda ok with fronting all the costs even if I don't make any money from the site, though I would be disappointed if I didn't make anything. Is it too naive to think that I'd make some profit from my first online business project?
Anyway I'll leave it here. Please let me know your thoughts as I'm very very new to all this and am always trying to learn/improve. Any help is appreciated!
Cheers
Gabriel
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