All businesses rely on maintaining an acceptable profit margin by reducing costs. The lower your costs, the lower the price you can charge for goods and services to ensure a competitive advantage while still ensuring healthy profits. Regardless or the business model you are using (low margin but high volume or niche low volume sales at a much higher margin), the lower your internal cost structure the better your bottom line will look. From this source https://bumber.info/, you will know some key factors that can help reduce your e-commerce costs.
E-Commerce Advantages
There are many inherent advantages to e-commerce. Primarily is much lower overhead for space. You do not need high cost retail space – a warehouse or garage works well. This, when combined with lower insurance and utilities, is a huge advantage to the internet entrepreneur over conventional brick and mortar retail stores.
Reduced employee costs is another big advantage. A single person can respond to email enquiries from far more customers in a day than a person can standing in a retail store can address face to face. As people have become accustomed to purchasing goods and services online it is actually their preferred method of interaction now.
E-Commerce – the cost of business from a distance
The primary disadvantage of conducting an online business is the added difficulty in establishing trust and the lack of instant fulfillment to the customer. If a customer walks into a store they can touch and feel the item which inspires more desire and if they decide they want it they walk out with it on the spot. This allows for impulse purchasing and decision making based solely on instant gratification and fulfillment of immediate need. Far less trust is needed if they have it in their hands when they make the purchase.
Online sales require them to be educated enough about the product that they are comfortable ordering without having seen it or touched it, trust your business enough that you can actually deliver it as promised, and willing to forego the instant gratification which allows buyer remorse to set in before they have even seen the product.
The time it takes to complete a purchase transaction is critical. If you have been to a big box store on a busy day you will see an assortment of random items set on shelves near the checkout lines. These are from people that in the 3 – 5 minute wait to make the purchase changed their mind with the item in their hands. Compare that to long multi-click transactions of several minutes when they know they will still need to wait several days even when done. Huge numbers of sales are lost simply due to cumbersome online checkouts.
Simple Solutions
The easiest way to positively reduce cost while simultaneously increasing customer satisfaction and trust is by implementing simple streamlined shipping and checkout procedures. The reduced time to complete the purchase, promise of rapid delivery, and customer choice inspires trust and confidence. The best example of this is online retail behemoth Amazon. One click checkout and low cost or free one and 2 day shipping make it possible to get impulse purchase customers in an online format.
Though virtually no other online business will enjoy the economy of scale that Amazon gets, you can easily follow the same blueprint. The key is simply to use automated software to you advantage. If you have customers being redirected to 3rd party shipping sites to calculate shipping costs and are asking them to choose a shipping company you are adding to time and difficulty of the purchase. From a cost perspective, having them choose the wrong shipping company will add to your costs.
Automated programs like Dataplug can easily pull shipping dimensions and weight from inventory specs, choose the most cost effective carrier by time of delivery, and include any volume discounts by carrier. In addition, by having it all automated your handling time before actual shipment is greatly reduced- simply print off the shipping label and place parcel for pick up as the software will even notify shipping company of pick up needed.
The customer will be able to select speed and cost easily and track package from your website and you will be able to answer any customer enquiry simply by looking at your computer. This allows even small businesses to provide a level of service equal to that of online giants with no increase in labor costs and realizing savings in shipping costs.
