E-commerce helps underdogs
By Deborah Adamson
Advertiser Staff Writer
For years, Big Island farmer Howard Yamasaki yearned to do better than getting paid peanuts for his crop of macadamia nuts and Kona coffee.
Eugene Tanner • The Honolulu Advertiser
"Selling the product to the processor is where we get chopped off at the knees," he said. "We have no control over price."
Ermie Goodrich of BarnPlans Inc. of Waimanalo says she doubts that she and her husband, Daniel, could have made a go of it without selling online. Sales of barn plans are going so well, they're opening an office in Oregon.
Four years ago, he decided to sell directly to the public through the Internet — enabling him to charge more. His 100 percent Kona roasted coffee retails for $22 a pound. He used to get 60 cents a pound for the unprocessed coffee.
Since he started selling online at www.pookela.com, his bottom line has doubled.
"I think it's the only way to go," said Yamasaki, co-owner of Po'okela Enterprises in Kealakekua. "I have a friend who produces 2 1/2 times what I produce. He keeps grumbling about the low prices. I keep telling him to get out of that racket."
The Internet has leveled the playing field for small businesses in Hawai'i. In cyberspace, there's equal, direct access to the world's consumers. Moreover, Hawai'i's distance from the Mainland means little in a virtual world.
The Internet enabled Daniel "Dano" Goodrich, and his wife, Ermie, to sell barn plans from Waimanalo to the world.
As a child, Dano Goodrich had always been interested in barns. After moving from California to Hawai'i in 1991, he even built one on his property in Waimanalo.
"I had been fascinated with gambrel barns and decided to design my own gambrel truss and had it engineered," he said.
Three years ago, they began selling barn plans through the Internet. The business has done so well, they are opening an office in Oregon, where they vacation.
Without the Internet, "I don't think he would have succeeded," said Ermie Goodrich, the company secretary of BarnPlans Inc. at www.barnplans.com.
Despite the benefits of having a Web presence, many small businesses in Hawai'i are resistant to e-commerce, said Kara Murayama, president of Slingshot Communications in Honolulu, an interactive marketing consulting firm.
Nationally, nearly 70 percent of small businesses don't have Web sites, according to a survey by Verizon Communications. Also, fewer than half of the firms in the survey said they had better revenues after launching a site.
That's why companies must be smart in the way they establish a cyperspace presence, even if it means not having one at all if it's not feasible, said Gregg Yamanaka, chief learning officer at TeraBiz, a technology and business-skills training development firm.
"A Web interface is more effective in some industries than others," he said. If it isn't done right, "it will be an expensive proposition."
Here are some tips about getting into e-commerce:
• Know your target customer. Will they buy from you online?
Travel services and retail will benefit from having a Web site, but local restaurants and brokerages might not, said Yamanaka.
• Set up a realistic budget.
Having a Web site created could cost from $500 to $100,000 but a decent site should run between $2,500 to $5,000, Yamanaka said.
Allocate another $250 a month for Web hosting costs and for using the services of a webmaster, who would update your site.
Expect to spend at least $100 a month for marketing online, said Warren Hollinger, co-owner of i-magination, a Web designer in Kailua village in Kona.
Many businesses make the mistake of thinking that once they put up a Web site, customers will flock to them. Not so, he said.
"It's like you're in a broom closet in Ala Moana. Nobody goes into the broom closet," Hollinger said.
Also, print your Web site address on your products, cards, shopping bags and other places to add exposure, Murayama said.
• Look professional online or you'll turn off customers.
You could ask a friend or relative to set up a Web site for you for a pittance, but you risk looking amateurish, Hollinger said.
• Make your site simple and appealing to your target market.
The design of your site should direct customers to a few main choices, which should lead to a showcase of your products or services, Hollinger said.
For faster loading, avoid adding music or video that automatically loads when customers go to your Web site. Many people could be turned off by slow loading time. Instead, give them a choice to listen to music or watch a video by clicking on a button.
Note that having a video of your product or service might backfire on your business. If you don't have it done professionally, it could turn people off.
• Make sure your contact information is clearly visible. Add a phone number and address instead of just giving customers an e-mail address.
• Avoid advertisement banners. While they could help defray your Web site costs, their use makes your business look like it can't afford even basic Web hosting service.
• Get your own domain name. It would make your business look more polished.
• Don't just put up a site and forget about it. Treat it as a serious money-generator, said Raj Nisankarao, president of the National Business Association in Dallas.
• Make sure you fill orders efficiently or your customers won't be coming back, Yamanaka said.
Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.
