Why I want to sell a service - Amazon associates - 1099k

This week I created Amazon associate referral links on my website.  Actually pretty easy to do, and has some great earning potential.  

When I started looking at what the referral fees are it's amazing that Amazon is able to keep prices so reasonable and even cheaper than retail when they are paying up to 10% as a referral fee on some products.

If you think about how hard it is to make a net profit of 10% on something, the ability to capture that kind of profit without having to produce anything (other than buyer interest) is awesome!!   When we owned a restaurant we tried to keep food costs to 35% because after labor, the cost of the building, waste and other expenses we would have been thrilled with a 10% net.

In comparing notes with classmates, it seems that many states have no sales tax for services vs. products/goods.  So starting with a service definitely makes your Minimum Viable Product musch simpler.  I also like the idea of advertise and sell first and then become a supplier second.  If you have a good sales funnel, you can always change the referral to your own product later.

Web Marketing W05 - Site design and taking payments

     So this week we worked on site design and looked for similarities between successful websites (or websites that we might consider as a model for building our own).
     While intersting to change the point of view for looking at websites, I'm a little jaded.  I have been working on getting several web sites up to WCAAG 2.0 AA standards for accessibility.  Unfortunately, it has been a painful exercise, and one that requires a level of detail that would scare even a seasoned developer.
     I was biting my tongue a little bit this week because of it.  Fortunately, it seemed like many of my classmates quickly made the statement that they would be hiring a web designer to build for their real business.  Hopefully they will be able to find a web designer that is aware of the frequent changes to web standards and regulations.
  While I have been a paypal user and merchant for years, I haven't revisited making a payment button for a long time.  It was fun to discover some new features (like inventory tracking and controls that have made paypal buttons more dynamic.

W04 Site and host builder

     This week was a lot of dejavu. 

     I've built sites before on several different platforms and with several different tools.  The constants in the process are:
1) You eventually have to just make a choice and get started.
2) You WILL have some sort of frustration.

     With all of the help that is available through youtube and how to sites for writing code like W3 schools, you will be able to get it done.  The time spent on researching which web and site host was actually more time than I have taken to build some sites.  Seems crazy right, to slow down a process that much. 
     This week I chose to focus on a couple of the free site builders and honestly think if I were writing the curriculum for the class, I might have had students try to build a home page and a product page on a free builder like Wix or Weebly as a test run (stop short of paying for anything).  Try inserting a piece of code, or a paypal link (also free to open a paypal account) and then had them use that experience to inform their decision about what they were looking for in a site builder.
     It seemed that many of my classmates just added to their paralization by too many choices, and maybe a more direct, hands on approach could give them experience as a foundation to build on.   What's the worst that can happen, they would abandon a site that they built with a minimal amount of time and paid nothing for.  There's my two cents.

Sell something or sell nothing, just SELL!!!

     This week we are learning about ways to run an internet business without being a typical merchant or even digital storefront.
     As we started thinking about how a business without a product could actually earn revenue, the 2 models we focused on were affiliate or drop ship.  Drop ship would be a site that actually has items for sale, collects payment and then has a supplier or drop-shipper complete the sale.  Depending on the margin of the product for sale, and the ability to get orders, this can be very lucrative, however each time a product or price changes, the website would need to be updated, and fees for accepting payment, return shipping and customer care all whittle away at profits.
     When we started out the week I had the typical business model of buy something, put it in my garage and then try to sell it.  While this may work for some, it made me think of having a garage full of items that don't sell and lots of money invested that you may never get back.  While drop shipping gets your garage back, you are still tied to the business.  I never want to be owned by my business again unless it is truly worth it.
     In comparison, the affiliate model is elegant in being able to provide recommendations, blogs, youtube videos or any other content on your website and profiting from it through banner ads linking visitors to products.
     A moral/ethical question I had was related to supply/demand.  While the affiliate mode is ultimately the model I will choose for this class, in a merchant model, is it ethical to say a product is out of stock (because you don't have any stock purchased yet) and allow consumers to back-order until you know how many customers will actually buy?