ECommerce Vs. Traditional & Alternative Investments Difference

Expanding your portfolio and making your mark in the eCommerce landscape are among the most promising and safe investments with a steady return. In the future, creating the right impression might even help you make millions in revenue, just as it was possible with stock market investments back in the 70s.

The best part? All this is now possible from the comfort of your home without having to work late nights!

During the past few years, we’ve seen many brick-and-mortar stores closing while online shops quickly increase and double with every passing day. Plus, the fulfillment centers of Walmart and Amazon are taking over the territory of conventional retailers. Today, we live in a new world where COVID-19 has realized the takeover of online shopping.

This article explores how eCommerce investment compares with several different traditional investments and why you should consider it in 2022 (and beyond).

Source: Freepik

eCommerce vs. Saving Cash (Inflation)

A recent survey by CNBC shows that investors fear inflation the most in 2022. According to the Bureau of Labor Statistics, the yearly inflation rate in May 2022 was 8.6%, its highest level since 1981. In the coming years, this rate is expected to increase further because of increasing inflation in specific economic sectors such as real estate, commodities, and the service industry. So as time passes, your cash savings will eventually fade.

Many people seem to be interested in investing in commodities like gold. However, it’s not as profitable as investing in an eCommerce business. Why do we say so?
Firstly, gold has just reached the same price tag in a 10-year circle, and some industry experts believe that, as economies slowly recover over the next few years, the price of gold will reduce and be worth much less per ounce than it’s today.

Secondly, buying gold is not an investment in company growth. You won’t receive dividends or interest from tangible gold, and you may even have to wait years for gold to go up in value. On the other hand, you may start seeing gains within just 18 to 24 months of your eCommerce business.

eCommerce vs. Stocks & Bonds

Stocks and bonds seem to be very popular options among investors. However, these investments come with a unique set of challenges. Firstly, stock prices are risky and volatile. They can be unpredictable, increasing and decreasing quickly, often concerning companies’ policies, which you can’t influence as an individual investor.

Secondly, stocks signify a company’s ownership; therefore, investors are the last to receive payment, just like all other owners. A business has to first pay its workers, contractors, and creditors, maintain its facilities and pay its taxes. Any funds left can then be distributed among owners.

Here’s another big drawback of investing in stocks. Even though investors are part of the group of company owners, they don’t enjoy all of the rights and privileges that private business owners do. When investing in a public company, you may also have very limited access to information about the company. This can sometimes worsen the quality of your investment decisions.

On the other hand, as an eCommerce owner, you are in full control of the investment. You don’t have to rely on any other company’s policies. You can set your own rules and policies. Plus, you can enjoy a higher return on investment (ROI) if you’re able to negotiate good prices with the manufacturer. In contrast, the average stock market return has been only about 10% annually for almost the last century.

eCommerce vs. Crypto

The biggest downside of investing in crypto is the volatility and uncertainty of the market. Unfortunately, most investors enter the market with little or no knowledge and start tossing in their money based on guesswork.
Crypto trading is a highly manipulated financial system, which is full of bubbles and fluctuating government policies that influence your investment.

In recent months, crypto prices have crashed along with the stock market as investors grapple with continued surging inflation, Russia’s war on Ukraine, rising interest rates, and recession fears.
As of August 2022, Bitcoin has seen a nearly 42% decline, whereas Ethereum’s price has dropped by nearly 35%. Some experts think the prices of bitcoin and Ethereum could drop even lower in the coming months.

Here’s another big drawback. Although crypto is quickly gaining acceptance among merchants and individuals, major areas of the economy still don’t recognize it. For instance, you still can’t transact business at your bank with crypto. You also can’t use crypto to pay your taxes or buy groceries.

On the other hand, having an automated eCommerce store has little to no risk. You don’t have to worry about maintaining physical shops, paying workers, or tackling insane taxation.
As digital life progresses, eCommerce becomes a long-term investment with a continually flourishing market. It’s best to provide a steady and predictable cash flow against inconsistent market trends and massive losses.

Source: Freepik

eCommerce vs. Real Estate

Have you ever wondered why many real estate investors are investing their assets into eCommerce stores? That’s because, just like eCommerce automation, investing in real estate is similar in terms of stability and revenues.

However, there’s one big difference.
Once you sell your property, you exit the real estate market. Plus, you’ll feel more troubled by inflation and taxation issues when turning your real estate returns into cash than selling on eCommerce marketplaces.

Another benefit of eCommerce is that you can start an online store even with a limited budget. But real estate will require a large upfront down payment, especially if you purchase an investment property.
Additionally, the high initial investment needed to buy a single property can make it difficult to diversify across several. Moreover, selling a residential property can cost up to 10% of the sale price between real estate commissions, transfer taxes, closing costs, and other overheads.

Enjoy a Profitable eCommerce Investment with AWM

eCommerce is a stable and long-term investment, much like owning a property but only with less capital or credit funding. Keeping in mind the current recession and inflation that’s happening and hurting all the other areas, investing your hard-earned money in eCommerce is a safe route.

At AWM, we build high-profit online businesses for our customers through a done-for-you service, providing support for everyday investors to enter into the ever-growing eCommerce industry.
We offer a wide range of eCommerce services, including establishing business credits, qualifying and scaling up online stores, inventory sourcing, and procurement, and developing logistics and fulfillment systems.

Interested in starting your online company?

Let’s talk!