Despite the recent upsurge in consumer support for the high street, the future of retail looks certain to be driven by eCommerce. This is why it’s been encouraging to see many independent retailers fighting back in the face of the pandemic and moving their businesses online.
It’s a great opportunity for SMEs. These retailers operate on a grassroots level. They can have a more intimate knowledge and understanding of customers’ needs. They can stay lean and keep bureaucracy to a minimum.
But for all of the local success stories that we’ve heard recently, there have also been hundreds of retailers who have come unstuck. In some cases this is because of basic operational issues. In others, it’s a lack of understanding about the differences between high street and online retail. Indeed, many existing eCommerce providers have also struggled to maintain their operations in the past few months. The pandemic has exposed the limitations of their business models.
As customer expectations start to return to pre-COVID levels, patience around lead times, order delays or inaccessible support teams will start to wear thin. Ecommerce retailers need to raise their game accordingly. Specifically, they need be more methodical in how they plan, grow and sustain their business. They also need to spend appropriate time future-proofing every aspect of their operations.
This is a ‘big business’ mindset that all retailers need to adopt in order to compete effectively in the crowded and uber-competitive eCommerce arena. And while results won’t come overnight, here are a few pointers for retailers that are looking to think ‘big’ and stand apart in the market:
Diversify your product range
We began our business with a ‘tent pegs and toys’ approach, i.e. one product set for summer and one for winter. It sounds basic, but if it’s possible to diversify your range in line with seasonal buyer behavioural, this may be much easier than coming up with experimental marketing campaigns designed to sell camping gear or paddling pools at the height of winter.
Diversify your supply chains
Unfortunately, the COVID-19 crisis has shown a lot of retailers that it’s not much of an advantage having an on-trend brand if supply chain issues make it impossible to deliver the goods on time. Diversification of supply chains, sourcing from multiple providers based in different parts of the world, is already a common tactic within the world of big business. It’s an increasingly sensible option for all retailers today, even if it means paying slightly more.
We’ve seen some retailers expanding their range by purposefully looking for products that are shipped from different markets. The planning assumption is, if one supply chain encounters issues, the other product can continue to be sold. You might even want to contemplate the possibility to manufacture, produce or assemble the products yourselves and cut out a section of the chain.
Inventory may count for more than cash
There’s been much talk throughout the crisis about the importance of having cash in the bank. However, for eCommerce retailers this needs to be weighed up against the advantages of having readily accessible inventory. Cash simply doesn’t help if inventory runs out and there’s no way of purchasing more. With long-term global supply chain disruption inevitable, you might benefit from having the extra inventory (and acquire volume discounts, of course).
Make the time for contingency planning
It has taken a global pandemic to make us recognise the benefits of preparing a Plan B and Plan C.
Every retailer must ask themselves what they can do to mitigate potential risks. They must also assess the cost/benefit of every additional ‘backup’ measure put in place. This could involve scenario planning for the worst disaster imaginable. Equally, it could be simple steps such as purchasing extra consumables. At the start of the crisis, for example, we decided to buy six months of printer ink and packaging supplies, just in case. These sorts of steps are unlikely to prevent all-out catastrophe, but they’ll minimise the chances of day-to-day hiccups occurring.
Take yourself out of the equation
Many small businesses are only as great as their founder. This is fine, so long as the founder remains fit, healthy and at the helm. But the ‘big business’ mentality holds the edge here. In this scenario, it’s about making the business operate seamlessly even when the person in charge is waylaid. Documenting critical processes, sharing responsibilities, getting trusted colleagues as backup operators can all make a difference in the event that you are suddenly taken out of the business.
Martin Bysh is CEO of Huboo, a UK-based multi-channel fulfilment service for eCommerce businesses of all sizes.
huboo was founded in 2017 by Martin Bysh and Paul Dodd, with headquarters and warehousing operations in Bristol, UK.
Originally launched to help start-ups and SME businesses get their products to customers quickly and cost-effectively, huboo today makes a comprehensive, software driven fulfillment service accessible to all sizes of business across the UK, with plans to expand its scalable model into Europe and the US.
Custom-built technology innovation behind the huboo service offering includes a full Warehouse Management System, and a one-stop dashboard for customers to set up, monitor orders, stock inventory and track live product deliveries. The core technology platform integrates with all popular sales channels and marketplaces, with custom integrations also supported.