Free shipping, same day delivery, refunds and returns. Today’s eCommerce is putting real pressure on a retailer’s profit margins.
Many retailers entering the online arena are realising that the cost of online commerce is outpacing revenue. Every market is going through change and with the macroeconomic conditions set to worsen over the next decade, retailers must look at ways to maximise profitability without sacrificing their quality of service.
According to an Oxford Economics report in 2022, 56% of eCommerce retailers are looking at new markets to develop additional revenue streams as a priority. Yet entering a new market is not just costly, it adds additional pressures to existing internal business processes. Brands that build agile processes are often better placed to innovate, in order to succeed. But what else must an innovative eCommerce retailer consider?
Adapt and Deliver
The rate of change is only matched by the high expectations that consumers have. It’s important to get the foundations of any retail organisation right (after your product of course). When entering a new market, this will include the right fulfilment partner and an eCommerce / ERP solution that integrates seamlessly with your business and the fulfilment centre. It should also be able to quickly satisfy consumer demands e.g. delivery and returns that are swift and efficient.
56% of eCommerce retailers are looking at new markets to develop additional revenue streams as a priority.
End-to-end connectivity
When products are out of stock, consumers should be able to request notifications when the stock is renewed. This is not only helpful to the consumer but works as an indicator to the retail business that specific items are in demand. This requires a removal of traditional silos and a more cohesive approach – from design of your eCommerce platform to the fulfilment centre. It’s important to remind one that they rely on the other. Retailers who can get their business units working together efficiently are able to engage with consumers, identify key upsell opportunities, capture data and delight consumers – without eating into profit margins.
Visible insights
We use the word “visible” as many organisations have insights that they simply don’t see, or worse, ignore. Every business wants to deploy effective consumer analytics to understand business performance and consumer behaviour. However, some fail to understand the *what* and the *why*.
- The What? Well, that all depends on where your profitability comes from.
- The Why? With insights, you can deliver personalised experiences to consumers that wow them and encourage a higher average spend. According to some experts (and we agree), delivering personalised, omnichannel engagement across multiple human interactions throughout the buyer’s journey will increase engagement. Higher engagement leads to more consumers spending higher amounts, higher conversion rates and increased loyalty.
Adjusting your internal processes and aligning your teams (this means removing silos), can only have a positive impact on your bottom line. This is especially true at a time when profit margins are being squeezed. Those who wish to succeed have to be nimble, innovate and have the ability to remain agile and responsive as and when the market demands – which isn’t easy.
Retailers who can get their business units working together efficiently are able to engage with consumers, identify key upsell opportunities, capture data and delight consumers – without eating into profit margins.
Focus on Growth
When entering a new market, it can be challenging to keep the various plates spinning (growth, compliance, customer loyalty etc). We believe every ambitious retail organisation needs a partner who can manage all the compliance matters. These are often complicated, time consuming and plain well distracting. While you focus on growth, let us focus on the “other” things! If you would like to learn more, book a call with us. We will listen to your growth goal plans and offer our experience that might help you make sense of this fast moving market.
Many retailers entering the online arena are realising that the cost of online commerce is outpacing revenue. Every market is going through change and with the macroeconomic conditions set to worsen over the next decade, retailers must look at ways to maximise profitability without sacrificing their quality of service.
Taxmatic automates VAT calculations, filings, and payments for eCommerce retailers selling in EU and UK markets. It integrates seamlessly with eCommerce selling platforms to access sales order data in real time. The process includes secure payments wallet technology to complete sales tax remittance and manage refunds. Our customers have the peace of mind that comes from full regulatory compliance. Plus, the benefits of eliminating manual processes. Gaining more time to expand their online business in new international markets.