Detailed explanation of store opening costs and profit improvement strategies on Lazada e-commerce platform

With the rapid development of the e-commerce industry, more and more merchants choose to enter major e-commerce platforms. Among many platforms, Lazada has become the first choice for many merchants due to its unique geographical advantages and the strong background of Alibaba Group. However, for novice sellers who want to open a store on Lazada, it is crucial to understand the costs of opening a store and how to increase store profits.

Main costs of opening a store

The main costs of opening a store on Lazada include the following aspects:

• Logistics cost: This is one of the higher costs of opening a Lazada store, usually accounting for about 25%-30% of the total cost. In order to save this part of the cost, you can choose a third-party logistics company with higher cost performance.
• Product Cost: No matter which purchase method is used, the manufacturing cost of the product is one of the major expenses.
• Platform transaction commission: For each successful transaction, the Lazada platform will charge a transaction commission of 1%-4%.
• GST: In Southeast Asian countries, the value-added tax rate is usually between 6% and 12%.
• Other fees: Such as withdrawal fees, platform account rates, etc.

Suggestions for improving store profits

Cooperate with high-quality suppliers

Although the cost of cooperating with high-quality suppliers may be higher, it can ensure product quality and increase consumer repurchase rates, thereby increasing overall profits. Additionally, quality products help build goodwill and stand out in a highly competitive market.

Selling branded products

Consumers in Southeast Asia are more inclined to buy branded products. Therefore, registering a trademark, obtaining brand authorization, and selling branded products can not only increase product value, but also create a larger market share.

Reasonable pricing

Reasonable pricing strategies can ensure higher profits for products and stores. To avoid profit decline caused by low-price competition, through reasonable pricing, sellers can provide better products and services, attract more buyers, and increase store profits.

Methods to control costs

Control product selection costs

When selecting products, sellers should choose products with reliable quality and controllable cost. Establish a cost policy in advance to avoid choosing products with high prices and substandard quality to avoid customer complaints.

Control logistics costs

Choosing a cost-effective third-party logistics company can effectively reduce logistics costs. It should be noted that the charging standards of each logistics service provider are different, so it is recommended to shop around.

Conclusion

It can be seen from the above analysis that although the Lazada platform may face certain cost pressures in the initial stage of opening a store, by reasonably controlling costs, choosing suitable partners, selling high-quality products, and formulating reasonable pricing strategies, it is entirely possible for sellers to Earn substantial profits on the Lazada platform. At the same time, Alibaba Group’s technological reorganization and resource investment in Lazada have also provided merchants with a more stable and efficient operating environment. In the future, as Internet penetration increases in Southeast Asia and the e-commerce market continues to develop, Lazada will continue to optimize user experience and help more merchants achieve business success.