5 Issues Small Ecommerce Retailers May Face in 2020 

Ecommerce keeps growing, representing an increasing share of total retail sales. As more and larger online stores open, small sellers can face new business-threatening problems in 2016.

Ecommerce has become the small businessperson’s buddy. The section has a relatively low barrier to entry and can require comparatively few resources or workers. While this will not likely change anytime soon, at least five current trends may represent significant issues for small ecommerce operations.

1. ) Competing on Price and Shipping

Online merchants often compete on price. By means of example, dozens or even hundreds of vendors can record identical products on marketplaces. These companies are vying to make a sale with nothing to differentiate their shops except price.

Some 18 unique vendors, including Amazon appropriate, are providing this Smurf figure available on the Amazon Marketplace.

This sort of price competition has hurt a few smaller retailers, which may not have the buying power to compete with mid-sized or enormous competitors. Add to this the pressure to provide free delivery on pretty much any purchase, and price and transportation competition is a real problem for a range of stores.

In 2016, this issue will grow worse to the smallest businesses in the industry. Large online sellers like Amazon and Walmart have transport facilities throughout the nation. These dispersed warehouses allow big ecommerce businesses to send orders from the nearest facility, which for as many as 60 percent of requests is at the same metropolitan area the customer is in. When orders are sent out of these nearby warehouses, the cost to send the order may be substantially less and the order will often arrive with a day or two.

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The point is, online shoppers will increasingly expect fast, free shipping — and the lowest price.

Small retailers will need to distribute their inventory to fulfillment warehouses, become very efficient shippers, or find unique products to minimize this situation.

2. ) Competing against Producers

Many small online stores buy products wholesale from producers or distributors to market at retailstores. This is the traditional business model for retail stores.

Unfortunately, ecommerce’s low barrier to entry has encouraged many product manufacturers to start selling directly to clients. It follows that the exact same company that sells your products will also be your competitor. As an example, Danner Footwear, which is a branch LaCrosse Footwear, sells not only wholesale to retailers, but also directly to consumers on its website.

Danner Footwear, a product manufacturer, is competing with its traditional customers — merchants — for ecommerce sales.

This issue will most likely be worse in 2016 as more manufacturers start selling online. To counter this trend, small ecommerce retailers should hunt for exceptional or private label products to market.

3. Selling in the Social Channel

Social media has long been heralded as a growing and efficient tool for marketers. By some standards, however, it has not yet lived up to its potential. This may change — to a extent — in 2016 for a few reasons.

Social is vital for people and as a substitute for research. Some data suggests that Facebook and Pinterest are among the greatest resources for ecommerce traffic. There is even evidence that shoppers have begun to use these platforms to search for products. Add to this the outbreak of social media buy buttons and the station may signify selling opportunities for ecommerce in 2016.

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The problem for small online vendors is that this creates another selling channel to manage, if it is going to become available whatsoever. At the time of writing, Buyable Pins on Pinterest, for example, were only available to select national brands or vendors using one of five preferred ecommerce platforms.

If social starts to represent a significant ecommerce station, small merchants will have to understand how to manage it and compete in it.

4. ) Customer Loyalty

Customer loyalty may be the principal area of attention for ecommerce businesses within the next few decades. It’s simply far more rewarding to advertise to loyal customers than it is to always find new ones.

As an example, in March 2015 The Washington Post published an article about how losing customers had hurt J.Crew.

“J. Crew is learning the hard way that in an era when ecommerce has presented women with ever-greater buying choices, customer loyalty isn’t easy to acquire and incredibly easy to lose,” wrote the post’s author, Sarah Halzack.

Small business owners and owners rarely have the kind of resources available to large competitors. So these very small stores may wish to take extraordinary measures to maintain shoppers.

5. ) Creating Content

Content marketing is more than a buzz. It is becoming an important marketing strategy for both acquiring new customers and engaging loyal ones. The best ecommerce marketers are creating excellent how-to videos, industry-leading fashion posts, and posts offering real value.

Comparatively large online stores may have entire teams specializing in creating compelling content.

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It may be problematic for smaller retailers to maintain, but there is still hope. Even the tiniest online shops can learn how to generate customer-attracting content.

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