Growing and scaling an e-commerce business can be very difficult given a multitude of issue’s that can affect your cash flow and supply chain. Most sellers will have a difficult time balancing funds and suppliers to ensure that they can keep replenishing inventory to meet demand as well as turn a profit however as your business grows, generally, everything becomes easier to manage.
In this article, we will explore 4 key area’s that sellers need to pay serious attention to in order to scale their e-commerce business in today’s e-commerce climate:
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Outsource Distribution to a Local Partner
There are a number of reasons why outsourcing distribution is a smart idea and will be a key factor in scaling your e-commerce business. The first one is simply the time that it will save either you or your employees as handling individual orders can be very time-consuming. Any time saved is crucial so that you can spend it on more high-value business development tasks that will help you grow your business more quickly.
The second key factor is that you will generally see a significant cost savings across the board and the third is your products will be closer to the local buyers which means that your products will be much more accessible. Consumers are generally looking for products that can be delivered to them quickly and cheaply, therefore, it’s important to have your products as close to them as possible. Outsourced distribution partners will generally manage customer returns for you as well which in turn provides you with added time and cost saving.
Do your research and find the right distribution partner(s) and be careful as some marketplaces won’t allow you to sell on their website unless your distribution partner is approved by them.
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Diversifying Your Suppliers
It’s vitally important that you have multiple suppliers of the products that you purchase. This rings true for re-sellers and manufacturers alike as having a diversified supply chain provides flexibility, redundancy and sourcing power into your control.
There is nothing worse than having a supplier not honor a critical purchase order during a peak season whilst you watch your inventory sell out and you are left with no way of replenishing your inventory. It’s advisable to have at least three suppliers of any one product that can service you to ensure continuity of supply.
The added bonus of having multiple suppliers is that it provides you with serious bargaining power if leveraged correctly and can translate into savings on the cost of the items being purchased. In addition, each supplier will most likely sell additional and different products from each other so you may find new and interesting products that can be sourced.
Diversify Your Selling Channels
With online shopping increasing every year, there are more online sales channel options available than ever before. Almost every country has a number of marketplaces that have gained traction with consumers and the challenge really is to find the best ones for your products. The big marketplaces such as Amazon, Tao Bao, T-Mall eBay, etc. Are well known and provide access to millions of shoppers however there are many more niche marketplaces and selling channels that may also be a great fit for your products.
Do a thorough research and find the right marketplaces and countries that are best suited to your product demographic. Always keep an eye out for new emerging marketplaces and channels because the e-commerce environment is evolving at a rapid pace and new opportunities are becoming steadily available whilst some channels inevitably die off.
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Diversifying and Growing Your Product Offering
The fourth and most important area that will help you to scale your e-commerce business is to continue to grow your product catalog. The introduction of new products will provide greater opportunities for making sales.
Whether you are simply introducing more products in your existing product demographic or you are trying to sell new products in a completely different vertical, it’s important that you are evolving your catalog to ensure that your products are relevant and in line with customer expectations.
Past customers who were happy with a previous purchase may be looking for something new from you and it’s always easier to sell something new to somebody that already knows you or your brand than selling to someone that has never heard of you.
New products provide great marketing and promotional opportunities that you can leverage, try to introduce and release at least one new product each month so that you have something new and exciting to talk about with your subscribers or followers.
There are other important considerations to take