This article draws on author Thanh Bùi's own experience launching an online bookstore and his e-commerce knowledge, as founder of the startup bita.vn from March 2012 to December 2012. 

Why Sell Books?

 There are 2 reasons:

 First, books were the product line we understood best at the time (we had previously worked at a company with a book publishing division).

 Second, books are fairly easy to sell. Unlike clothing or electronics, they are not complicated, requiring customers to try before buying and then after-sales warranties. With books, if you like & need them, you buy them.

Once you have books, where do you source stock?

 Because the entire team lacked experience, we had to figure everything out ourselves. We contacted publishers and book distributors in Hanoi to source books. Without enough capital to buy in large quantities, we tried to negotiate arrangements where we would collect books when orders came in. Fortunately, most publishers agreed to discounts of 30-35%. For distributors without Hanoi branches, to ensure a supply of their books, we negotiated with major Hanoi bookstores to buy their stock (specifically the bookstores around Đinh Lễ). Naturally, the discount was lower (in practice, they gave us an additional 10% off the retail price).

 So the Supply Is Secured. What Is the Implementation Model?

 After much consideration, we decided to adopt a traditional retail model, similar to Amazon, Vinabook, Tiki…

 We had secured supply and chosen our model. We began considering what differentiated our product from similar products in the same market

 At the time, based on our experience using and ordering from other e-commerce websites, we identified the following points that would differentiate us:

• Good service (complimentary plastic covers and bookmarks).
• Fast delivery (aiming for within 24 hours).
• Lower prices.

 People

 This depends on each team's circumstances. Our project mainly consists of close friends who knew and worked with one another before. We try to have each person handle one area: technology, marketing, PR, or content. At peak times, our team has reached 8 people.

 Technical system

 This is another very important part of an e-commerce website. After some research, we chose the open-source CS-Cart system and rented a VPS from PAVietnam.

 CS-Cart meets almost all our needs. The website interface is reasonably good, and the backend management system is also good & meets our needs in the initial development stage.

 Work location?

 Initially, we chose a team member's home as both our location and warehouse. After operating for a while, issues arose, so we decided to rent an office on Tôn Thất Tùng Street, opposite Hanoi Medical University. It cost about 3 million/month.

 And so all the preparations were complete.

 The operational implementation process

 There are 4 main areas: Cash Flow Management, Logistics, Marketing, and Content Management—updating and adding new products

• Cash flow management. We were all recent graduates and did not have much money. Calling it cash flow management was just for fun. In reality, it was simply about having enough money each day to buy new products, pay for express delivery… 

• Marketing. We primarily use Facebook as our main promotional channel, running a few events and contests there. We also do forum seeding (Webtretho, lamchame…). 

• Logistic. As mentioned above, we lacked the money to stock all products in our own warehouse. Each day, when customers placed orders, we confirmed them, collected the books from publishers, covered and packaged them, then delivered them to customers. 

• Content management. We visited other active bookselling websites, took their images & product descriptions, and uploaded them to our own website. Sometimes, for new titles, we received materials sent by the publisher. 

That was our everyday work in running the business. Things grew, but not much… until one day we ran out of money. And so a beautiful love affair ended.

Lessons from real life

Lessons We Learned While Starting bita.vn

 1. At the Product Selection Stage 

– Books are fairly easy products to sell because they do not require elaborate selection, previews, and so on. If customers need a book and the title is right, they buy it.

– Conversely, selling books has a problem: the profit margin per 1 product is very low. Order values are low ==> The cost per 1 order is high & it is hard to profit without sufficient scale.

Lesson: Choose products with careful calculation.

• Choose the product line you understand best. Ideally, you should already have experience in the industry.
• The same applies to target customers. Your target customers should be people whose habits and behavior you understand well.
• Make appropriate judgments based on your available capital and the market you operate in.

2. Cash flow/Cost management

Our problem was that we had no specific financial plan and had not estimated how much money we would need, so we ran out of money halfway through.

Lesson: Calculate expenses carefully and ensure you have enough money to maintain the system & support growth for at least 6 months before considering profits.

3. Copying without understanding the essence of the issue

As I wrote above, the difference we chose was:

• Good service (complimentary plastic covers and bookmarks).
• Fast delivery (aiming for within 24 hours).
• Lower prices.

Doing all 3 of these things would be very difficult even for a large company with substantial capital. But we were eager for a fight and plunged into all 3. As a result, the cost per order rose very high. The more we sold, the more we lost; the higher our sales, the more frightened we became.

Specifically: We discount each book title by 10%; plastic wrapping plus a bookmark costs 1,000đ/1 book (excluding labor costs). Then, to ensure fast delivery, we still make a delivery even if there is only 1 order: this takes a great deal of time and effort.

Lesson: If you want to do something, study its nature carefully, the difficulties you may face in implementation and whether your current resources allow it.

4. Promotion and marketing methods

At that time, almost nobody on our team had practical experience implementing online marketing in e-commerce. Our marketing execution was therefore very poor. Everything revolved around a few Facebook events and forum seeding. In addition, our available capital did not allow us to run paid advertising campaigns.

 As a result, website traffic was very poor, leaving orders and revenue below expectations.

Lesson: Balance costs & effectiveness to implement suitable promotional channels. Keep long-term costs in mind to avoid ending up in a situation “The Chicken-and-Egg Problem”. Seek advice from experienced predecessors.

5. Technical foundation

Back then, we rented a VPS from PA Vietnam (600k/month). Overall, the quality was quite poor and did not meet our needs. Slow access speeds => the website loaded very slowly, with frequent downtime => CR fell considerably.

Lesson: Find experienced people to advise you on systems, as well as which services to hire and where.

6. Office & warehouse location

Because we were a startup with little capital, we had to find the cheapest rental space. As a result, the route was inconvenient and the location was not close to suppliers' warehouses.

Lesson: Choose a location with the most convenient access to suppliers. If possible, see which area generates the most orders and move your warehouse there. This will save a great deal of shipping time & cost.

Doing e-commerce in Vietnam is not ‘a dream’ as many imagine. Success requires a solid financial foundation, operating experience and an understanding of the market and products… Think very carefully before deciding to invest in this field.

According to Tweenty