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How to Start a Mail Order Business

Target Market

To be successful in mail order, you must define your own special market, one where a genuine need or desire for your products or services exists, and one where the competition isn't overwhelming. Start by thinking about what you know, what you enjoy, and what your potential customers need or want. Then match your ideas against these three guidelines:

1. The products or services you sell must be things you know and are enthusiastic about. If you're an avid snorkeler or scuba diver, and you want to sell products to other divers or market diving-adventure vacations, great! But if you hate water, the thought of salt air makes you seasick, and you're getting into the specialty because somebody told you it was a good idea, then don't make waves. You'll very likely fail. Instead, you need to find something you understand and enjoy.

2. You must have a large customer base to draw from. If you know everything there is to know about flies, you find them fascinating, and you have a huge collection under glass, that's swell. But you're not going to find many people who will want to order fly merchandise. If, on the other hand, you're into fly fishing, you'll have a huge number of enthusiasts all over the world from which to draw.

Stat Fact
Business-to-business catalog sales are enjoying an upward trend. According to the Direct Marketing Association, companies that sell to other companies have a 7.3 percent annual growth rate, and there's no slowdown in sight.

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3. You must have a well-defined specialty. You may have a reputation as a shop-'til-you-dropper, and your friends and family may turn to you as the gift-chooser of choice, but it's unlikely you'll succeed with a broad catalog of gift items or preppy clothing. There are already too many really big companies out there doing the same thing, and they're too huge to compete against. But if you choose gifts or clothing for a specialized market, say handicapped children, the elderly, cat lovers or gardeners, you're moving in the right direction.

Selling Services

Generally, we'll discuss mail order products in terms of merchandise, but keep in mind that what you sell can just as easily be a service instead of a product. According to the DMA, services account for almost 40 percent of mail order revenue. While financial services make up the biggest sector of direct-marketed services, there are scads of other options, including photo processing, travel packages, consulting, genealogical research and real estate.

The only major difference between selling a service and selling a product through mail order will come in terms of inventory. If you're selling tours to Costa Rica, for instance, you're not going to have a stack of tours sitting on shelves in your back room; but if you're selling shirts made in Costa Rica, you probably will have boxes full of shirts waiting to be sold and shipped.

The other thing to consider with service-based mail order is the matter of accessibility. You can sell those Costa Rican tours because they can be handled long-distance. You don't need to be close to your customers to perform the service. Some services, however, like lawn care, require you to be conveniently located. So unless you've got a clever take on how to circumvent geography, you can't market this type of program to consumers outside of your immediate area.

Bestsellers

What products and services are runaway bestsellers right now? Industry experts agree that computers and their peripherals top the list. Other than that, the answers may surprise you. Take a look at these top-selling mail order categories, courtesy of John Schulte of the NMOA:

  • Art, drafting and printing supplies
  • Athletic equipment
  • Business equipment
  • Children's clothing
  • Educational materials
  • Fishing equipment
  • Global marketing services (especially in Europe)
  • Hardware
  • Health and fitness products
  • Home medical supplies and equipment
  • Industrial maintenance and materials handling
  • Internet investment brokerages
  • Library and school products
  • Men's clothing
  • Prescriptions
  • Software
  • Specialty products and gifts
  • Stationery specialties
  • Tobacco products
  • Video cassettes
  • Vitamins
  • Women's big and tall apparel
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