by John Donovan, CEO of Bizfi
It used to be that a business would gain customers only from the neighborhood surrounding its location. Now, thanks to internet technology, your customers can be from around your state — or around the world. E-commerce is well within reach of virtually every small retail business, and with consumers demanding an easier way to find and purchase products, businesses need to incorporate an online sales strategy to remain relevant.
Here’s why it is important to adopt e-commerce, and how to incorporate it into your existing business plan:
E-commerce is a gateway to all sales.
Window shopping has always been a key sales driver; e-commerce, at its most basic, simply takes that to the next level. Some surveys have found that 60% of all American consumers are already shopping online, and more are joining them every day. E-commerce gives potential customers an opportunity to gather information about your products before they buy, from possible sizes and colors to aftercare and warranties. Imagine how much time your staff would have to spend to convey all this information to shoppers in person and how many more sales they could close if your website could answer shoppers’ basic questions.
E-commerce can allow you to present more merchandise than you could fit in a physical retail location; indeed, some small retailers now forego a brick-and-mortar store completely, saving themselves tens of thousands of dollars annually in rent. Finally, know that e-commerce is simply the way that most consumers now want to shop.
E-commerce is easy to add into your business plan.
Start by brainstorming what you will sell online and do some simple projections about what even a small increase in sales—say five percent—could mean for your top line. Then, consider the added costs of adding e-commerce, from the cost of setting up your online sales site to the marketing and shipping expenses that you might incur. Don’t worry about your technology skills (or lack thereof): There are a wide range of ready-built e-commerce platforms out there for you to use, that can calculate appropriate sales taxes and shipping costs, as well as display merchandise. You’ll need to take good photos of your inventory, or get photos from your suppliers. It’s also a good idea to barcode the merchandise you’ll be selling, which will also make it easier for your in-store point-of-sale (POS) system to track how your inventory is moving.
Take time to get comfortable with the reports you’ll get from your e-commerce platform, such as what you are selling, where your online customers are located and how many online shopping carts are abandoned before a sale is completed. You’ll need to tweak your e-commerce strategy as you learn from these reports and, because technology moves quickly, you’ll need to factor in upgrades every six to 12 months. Remember that almost every aspect of e-commerce can be outsourced, from inventory management to fulfillment.
You don’t need to go all-in on e-commerce. Put a few items online, and spend some time getting comfortable with how shoppers interact with your site. Test your marketing channel options to see which will be the most effective driver of your new online sales. And remember that, even though all your customers may no longer be in front of you when you close a sale, you can use internet forms and social media reviews to learn what they think of your e-commerce sales experience.
John Donovan is the CEO of Bizfi, the leading fintech company with a platform that combines aggregation, funding and a marketplace for small businesses, and has more than 25 years of financial technology experience building companies and launching products within organizations. Since 2005, Bizfi has originated in excess of $2 billion in funding to more than 35,000 small businesses, including many well-known franchises.