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Starting a Micro, Micro Business Ideas, Blog · June 24, 2014

7 Reasons Not To Choose A Product-based Business

You are here: Home / Starting a Micro / 7 Reasons Not To Choose A Product-based Business

7 Reasons Not to Choose a Product-based Business

When starting a micro business, the first idea that pops into most people’s minds are to start a product-based business. But the problem is product-based businesses are one of the hardest businesses to run successfully. Here’s why:

  1. Inventory: There are many decisions to consider such as how much to buy and how to pay for inventory.
  2. Storage: You will need a place to store the inventory and space to wrap, label, and ship the packages.
  3. Shipping: It is not cheap to mail products and going to the post office to ship items is time-consuming.
  4. Packaging: You will need boxes, envelopes, labels, packaging, etc., all which costs money and takes up space.
  5. Unsold inventory: What happens if you bought inventory but cannot sell it?
  6. Back Orders: When you run out of inventory, your customers will have to wait until you receive more inventory to ship. Some customers will cancel their orders if they have to wait.
  7. Returns: It is impossible to make everyone happy and you will have to deal with returned products. If there is be nothing wrong with the product, you may be able to resell it, but you may be returned a damaged item. Returns can get expensive because you paid for the shipping initially and may have to pay shipping again to mail a replacement.

Starting_small-259x300This is why I recommend starting a service-based business in my book, Starting a Micro Business. A service-based business is low-risk, easy to start and easy to close down if need be. It also doesn’t have any inventory to worry about and most often requires no or very little start-up costs. A service-based buy is usually selling what you hold between your ears; your knowledge.

Learn more about starting a micro business by grabbing a copy of, Starting a Micro Business, today!

Carol Topp

Related posts:

  1. Start a micro business with no money (podcast)
  2. Video: Should You Sell Services or Products – Starting a Micro Business
  3. Video: Micro Business Idea – Services
  4. Building a Web-Based Store
  5. Get Your Product “On the Shelf!”

Filed Under: Starting a Micro, Micro Business Ideas, Blog Tagged With: Starting a Micro Business, product based business, teen business idea

Carol Topp, CPA

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From a parent

Thank you for your e-book on teen micro businesses. Your valuable experience and wealth of knowledge is vast.

Your presentations at Cincinnati homeschool conferences and sharing with us over the years have benefited us well.

I can hardly believe we are at this point in our life-and here he is a young man ready to try his fortune with the world.

-Mandy S

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