Online business is one type of business that is growing rapidly. It is undeniable that in today's digital era, most people prefer to buy products online because of their convenience. In addition, by buying goods online, consumers or buyers do not need to spend more effort exploring shopping centers and only need to look for them through their gadgets/smartphones.
Talking about online business, have you ever heard the term pre-order system or better known as PO? This time, BFI Finance will discuss the pre-order system in online business in the following article.
Understanding Pre-Order System
The PO system is a method in a business where consumers place an order for goods and pay for it in advance with the estimated time that has been promised by the seller until the stock of goods is available and ready to be shipped. Basically, the PO system is buying products before they are actually available.
Usually, sellers who sell goods with a pre-order system will ask the buyer for a certain amount of money in advance as a guarantee when the goods from the vendor/supplier are available. If the goods from the vendor are empty, the seller will return the agreed amount of money to the buyer.
If viewed from the seller's perspective, this system is considered quite profitable because it does not require large capital even without capital if the payment is made in full. On the other hand, from the consumer's point of view, as a consumer, you must be careful in choosing a store that sells products or goods with a pre-order system. Make sure the store you choose is a trusted store with a good sales history.
Business Benefits with Pre Order System
There are several advantages that you can get if you run a business with a pre-order system like the following.
When you start a business with a pre-order system, you can get an idea of the revenue from consumer demand. If there are consumers who make purchases and have given a certain amount of money according to the agreement, you can estimate the amount of income to your profit. Plus if the consumer gives all the money as payment. Then you can already see the amount of income earned. You can use consumers' money as capital to buy the goods they demand without having to spend capital.
Merchandise Sold Out
The next advantage is better inventory management. With the pre-order system, you can maintain the number of stock items in accordance with incoming requests, thereby reducing the risk of buying excess items or stock that can cause losses.
Generating Buzz or Hype
As has happened before, goods opened with the PO system before being released or marketed will create a stir and make consumers compete to order so as not to run out of stock. Especially if the item is an item with a special or limited edition.
Disadvantages of Pre-Order System
In addition to the advantages it has, a business with a pre-order system also has the following disadvantages.
In accordance with the principle, this pre-order system is a transaction that is limited by a certain period of time. This is what can make consumers prefer goods that are available or ready in stock so they don't wait too long.
Stock Not Available
The next drawback is when the stock of goods is not available because the supplier is late in sending or providing goods. Even though the fault is purely from the supplier's side, consumers will be disappointed with your store or sales service.
Can damage the image if the goods do not match
In addition to delays, goods that do not meet consumer expectations can also cause damage to the image of your service or store. Be sure to minimize disappointment with the following tips.
How to Succeed in Business with the Pre Order System
Choosing a Trusted Supplier
The first is to choose a reliable supplier. You have to be smart in choosing a supplier with proven safe transaction history and sending the stock of goods according to the specified time.
View Product Quality
Even though you only act as an intermediary between consumers and suppliers, you still have to check the quality of the products or goods that will be offered first before being sent to consumers. If there is damage, you can ask the supplier for an exchange or ask for a refund.
Take Advantage of Social Media
Since a business with a pre-order system is a business that takes time to process goods availability, ordering and delivery, you have to be smart to make interesting promotions on social media. Make sure to regularly upload product content and the advantages of buying PO products from your store. You can also do several other types of promotions such as giving discounts, free shipping, and gifts/souvenirs to consumers.
Make sure the delivery schedule is according to the agreement
The next tip is to make sure the delivery schedule is in accordance with the agreement with the consumer. This aims to prevent the emergence of a sense of disappointment that can destroy the good image of your store.
Selling products or goods with a pre-order system has its own challenges, especially the items being marketed are rare items or special editions which are very limited in number. Therefore, you need to set a sales target that is not too high. Sales targets that are too high can overwhelm you and also increase the risk of late delivery to customers.
Make Good Administration
If you intend to start a business with a pre-order system, you are also required to make good administration starting from recording every incoming order, writing complete consumer personal data, giving directions for the payment process and estimated delivery of goods, to dedicating human resources to serve consumers. who want to ask or make a complaint.
Providing Communicative and Friendly Service
The last is to provide the best service by being friendly and always communicative to messages asked by consumers.
Some businesses with a pre-order system do not require capital because consumers make full payments at the beginning of the transaction. However, there are some businesses that only ask for half or part of the payment as a down payment. To work around this, you can use savings as business capital or you can apply for a business capital loan with a vehicle BPKB guarantee or a house certificate at BFI Finance.
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This is information about the pre-order system commonly found in online businesses. Hopefully, the information can be useful for BFI friends who read it!