So youโre curious about becoming a seller but youโre unsure about how much capital you need to start selling on Shopee. Perhaps youโre scared of overstocking on products that take could take forever to sell. Or you wanna avoid spending on things that you donโt really need during the early stage of the business. If the answer is yes, read on and donโt look back โcause weโll cover all of these in this post, and at the end, youโll know the best practices on spending your capital wisely.
But before we discuss the estimated figure/s, why donโt we first audit the things you need before you can start selling on Shopee?
What you need before selling on Shopee
1. Smartphone
โBut I already have a laptop. Is smartphone really necessary?โ, you might ask.
The answer is yes.
- As a seller, you need to monitor new orders and customer inquiries all the time. Unfortunately, you canโt do that with a laptop because, first, itโs just not practical to bring with you anywhere. Second, Shopee notifications donโt appear real time in the laptop and sometimes, donโt even appear at all, based on my experience.
- If you donโt own a DSLR camera for taking product photos, donโt fret. Your smartphone is an excellent substitute. In fact, I prefer it over a stand-alone camera because uploading is much faster and easier.
How to choose the best smartphone for your Shopee business:
- Buy a smartphone that takes high quality photos. What I mean by high quality photos, is, the camera should NOT alter the actual color of the item. If youโre capturing faded blue jeans, it should look like faded blue jeans in the picture. Otherwise, your customers would think that youโre ripping them off. And you donโt want that.
- I recommend iPhone because a lot of reviews prove that itโs better at retaining the original color of the photographed item. But truth be told, the iPhone price didnโt meet my budget so I settled for Asus for 7k pesos, which has a decent enough camera. The iPhone will have to wait.
- Before buying, research and read online smartphone reviews so you wonโt regret your purchase.
- Just because a smartphone takes pretty selfies doesnโt mean itโs right for item photography. In fact, beware of brands who claim their phones take pretty selfies. Chances are, theyโre programmed with heavy filters that might turn faded blue jeans into shiny white.
2. Laptop
As useful as your smartphone will be, you canโt do all the work with it. There are functions that are only accessible through laptop/ desktop and not through the app.
In fact, these functions are very important that they could impact your sales big time. If you wanna take a peek at these functions, read: How to Increase Shopee Sales for Free: 11 Effective Techniques. Youโll see what I mean.
Besides, you donโt really need a fancy laptop. Mine is just a Google Chromebook I bought for 14k pesos in Lazada. I didnโt bother buying the more expensive MS Office as I donโt need one.
What you need from a laptop are pretty basic: browse, upload and download photos, and post in social media. Again, like buying your smartphone, read reviews online so you donโt waste time and money.
You can view the same laptop Iโm using here. What I like about it is that the battery literally last for 8 hours without charging. Perfect for sudden brownouts. Itโs also very light and thin so itโs easy to carry around when travelling.
3. Internet
No dear, you canโt just buy a load to last you for the next 12 hours. When youโre a Shopee seller, you need an all-out internet plan that provides unlimited internet 24/7. No less.
Now I know that in the Philippines, our internet service providers all pretty much provide crappy service. But still, subscribing to them is more recommended than telling your buyers, โIn case I donโt reply, that means I have no load.โ, which is an absolute no-no.
How to find the best internet service provider
Looking for an ISP in the Philippines means changing your question from, โWhich one is the best?โ to, โWhich one is the least crappy?โ
Finding the least crappy of them all will depend on your specific area. There are areas where PLDT is less of a headache than Globe. And there are areas where Globe loads a tad bit faster than PLDT. Choose your poison. But first, ask your neighbors.
(By the way, if you havenโt set up your store yet, check this out: How to Sell on Shopee: A Complete Beginnerโs Guide.)
How much capital you need to start selling on Shopee (for your stocks)
How much capital you need to start selling on Shopee isnโt a question with a one-size-fits-all answer. It depends on several factors. Letโs discuss the various scenarios that you might be in, in order to figure out how much capital youโll need.
Factors to consider before deciding your capital
1. If youโre based close to your suppliers
When I started selling on Shopee, my capital for my initial stocks was 8k pesos. And yes, I know what youโre thinking, โEight thousand pesos is very little for a capital!โ And to that, I have an explanation:
I originally live in Davao City. But when I opened my online store, I relocated to Manila. As much as I love Davao, it just doesnโt have the abundant supplies of affordable apparels that Manila has.
The reason I was able to manage with an 8k capital was because I didnโt (and still donโt) hold inventories of the the items I post in my shop. Meaning, until a buyer places an order, Iโm not buying any stocks. I only deduct from my 8k when I know I have a sure buyer. This way, every peso I spend has an equivalent profit and my capital isnโt stuck but flowing and growing.
The disadvantage:
Because I donโt hold the inventories, there are certain inconveniences that I have to deal with:
- What if the ordered style or color was no longer in stock?
- What if the quality of the item was poor and I only found out about it when I went to buy it?
- Wonโt it cause late shipment since I have to order from the supplier first?
These are very important factors that when dealt with poorly, would lead to a poor shop rating. And to discuss the solution to all of that, Iโll write a post next week: How to Sell on Shopee with Very Little or No Capital. So stay tuned.
2. If youโre based far from your suppliers
If youโre in Mindanao and your suppliers are in Luzon, then you definitely need a considerable amount of capital. A capital of 80- 100 thousand pesos should set you up nice and proper. This is for your inventory alone, excluding the laptop, internet, and phone.
Why you need a bigger capital
Since youโre far from your suppliers, itโs necessary that you buy your items firsthand before selling.
When you stock up first, the delivery only covers one routeโfrom you to your customersโand is therefore faster. But when you have to wait for your customers to place their orders first before you order from your supplier, the delivery time takes twice as long (around 2 weeks).
If you were the customer, would you wait that long, when you know other sellers could ship faster?
Even if you could find a way to shorten the delivery time frame to an acceptable length, are you sure that the same colors ordered by your customers would still be available? What if theyโre out of stock?
But I donโt know which items sell faster and which items donโt
Hereโs what I suggest to slowly get a decent understanding of your target customersโ tastes:
- Ask your suppliers. As seller themselves, they should expertly know which of their items are the bestsellers.
- If they have a Facebook group and youโre a member, check which items garner more comments and inquiries than the rest. Thatโs another clue to figuring out which sells faster.
- Create a Facebook Group or Page of your own, and ask your potential customers what styles theyโd be interested in.
- After getting the answer from your survey, buy the top 30 bestseller designs. Per design, choose at least 3 different colors. For each color, buy 3 pieces. Then start listing them on Shopee.
- If you have the resources, opening a physical store will definitely help. Aside from your online shop, youโll also get insights from your local customers and it could even add up to your income.
- After 3-4 months, you should already gain a decent understanding of your target customersโ taste. Expect that to improve in the months to come. Along the way, youโll make mistakes but take comfort from the fact that youโll learn from them. Most importantly, your capital will grow and youโll thank the day that you decided to open your store in Shopee.
Conclusion: How much capital you need to start selling on Shopee
If youโre based closed to your supplier, like me, you can start with as little as 10 thousand pesos. If youโre far, you need at least 80 to 100 thousand pesos and you should never spend it without conducting the survey above, to make sure that youโre only investing on the bestsellers, which are more likely to yield bigger profits at a much faster rate.
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