How to Build an Online Retail Store Making $20 Million Annually: An Online Leather Store Case Study

online leather storeMake money online is a fairy tale for some and a reality for others. For those that are making money online, many are struggling, making less than $500 annually, while some are making more than $100,000 annually.

Of those who make money online, there are an elite group that makes six, seven, even eight figure annual sales, either as a company or an individual, through various mean: retailing (i.e. selling motorcycle vests), consulting (i.e. setting up web businesses), and other means.

Your question (and mine, too) would be: How can they make such amount of money? Let’s “dissect” a web business entity, online retailing.

An online retailing case study: is an online leather store that 2008 sales figure has reached $20 million mark. They offer various leather products: Jackets, footwear, helmets, and various motorcycle (and motorcycle riders) accessories. If I am a fan of leather and ride a bike, I will definitely visit for one-stop shopping and right-at-your-doorstep delivery.

Trying to investigate how the e-commerce site do well, from a quick research I found the following (some are obvious, but worth mentioning):

  1. Rank your online store high in search engines through SEO and link building campaigns ranks in Google’s Top 3 search result for various product keywords, such as “online leather store” (rank #1), “leather store” (rank #2) or “motorcycle saddlebags” (rank #2). Those examples lead to one conclusion: You need to SEO (search engine optimise) your online store for the keywords you are targeting for automatic traffic from search engines. Please note, seems don’t use PPC advertising with the search engines.
  2. Own your product is a major US Supplier – No middleman overheads, no selling others’ products and you can wholesale your products as you wish.
  3. Sell complementary products
    Although mainly sells leather products serving the motorcycle market, it also provide complementary non-leather, niche motorcycle-related products, such as motocross chest protectors and german motorcycle helmets.
  4. Offer unquestionable guarantees offers 30-day return and low price guarantees. Strong guarantees convert more visitors into purchasing customers.
  5. Worldwide delivery
    Not only nationally, you should deliver worldwide – this way, your market is not only, e.g. US motorcycle enthusiasts, but also worldwide motorcycler riders.
  6. Offer various payment methodsAccepting credit cards only will limit your market significantly. is offering various payment methods, such as Paypal, Google Checkout, and also credit cards.
  7. Secure your online retail store
    You have to partner with online security services provider to eliminate (read: minimise) threats, such as viruses, identity thefts and scams. is partnering with McAfee and Thawte to secure their site. Make sure their seals or logos are displayed prominently and clickable, leading to verifications.
  8. Offer various ways to contact you
    Make sure your customers can contact you easily. You can start by using a toll-free number and contact form, displayed prominently on-site.
  9. Allow customers to buy first, register later
    Many mistakes I’ve seen with an e-commerce site is that customers are asked to fill lengthy forms (even a 1 page checkout is not effective if it asked for customer registration) prior paying for their orders. Instead, offer sign-up options later on, after the customers make the payment.
  10. Offer bargains at break-even or at a loss
    Bargains drive visitors to come. Period. Even breaking-even or sell at a loss on certain products at certain period of time can increase your overall profitability.

Learning from case study, I conclude one thing: You have to posses resources to do more online – In other words, you have to use money to make money. Bootstrapping is desirable, but often not effective if your vision is a $20 million online retail store. You need thousands of dollars for Internet marketing and SEO, and more thousands of dollars for product acquisition and development.

The best route for you and I is, as usual, start small, dream big – Let investors take care of your business financing later (if your bootstrapped business is successfully making you thousands of dollar monthly, I bet many web investors are willing to finance your business for growth.)

Ivan Widjaya
Online retailing
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