In 2017, the e-commerce sector in the UK had reached 137.38 billion, and it is estimated that the number will only move up with time. If you are a businessperson who wants to make the most of the e-commerce growth by initiating or scaling up your e-commerce business, then you should learn to maximise profits by controlling costs. To know the answer to how e-commerce business owners can reduce costs, simply scroll down.
1. Minimise the Returns
According to an estimate the worth of goods bought online by consumers globally and then returned is worth USD 642.6 billion a year. If you don’t want the expensive returns to be a part of your rising business costs, you should make sure that you provide a thorough product description, many images and videos wherever possible. Also, provide a long return window because it might ensure that a customer gets emotionally attached to the product and forgets about returning it. It is also smart to not target customers who have a track record of returning items. Only a bit of research is needed to highlight such consumers.
2. Negotiate Smartly
Negotiation skills are essential for any business owner. You should use them to get bulk discounts from the suppliers and maximize your profit levels. You can also negotiate with the credit card processor to reduce the fee or waive them off. While doing such negotiations, make sure that you look for backups before bending the other party too much. For instance, you don’t want to be left without a supplier if the supplier decides to cut you off rather than agree to the discounts you are seeking.
3. Seek Maximum ROI
No matter whether you plan and execute your marketing campaigns or you have hired a digital marketing firm to handle such tasks for you, you should keep an eye on ROI. You should know how much money is being spent on tactics like blog post creation, SEO, PPC, referral programs, influencer marketing etc. Calculating ROI is simple and essential if you want to know whether a marketing strategy is worth repeating or not.
4. Enhance Packaging
Another smart hack to save money while managing an e-commerce business is to optimise your packaging. If the packaging is too heavy, you can save costs of packing materials by reducing the packaging products like cardboard boxes. In contrast, if the packaging is too fragile and your goods are getting damaged while in transit, you will do better to enhance it to stop unwanted losses.
5. Consider Automation
Time is money for most e-commerce businesses and if you agree with the same, you should learn to adopt technological tools that can help you reduce inefficiencies while providing better control over business processes. If you are a small manufacturer, it would also be smart to sign up for a free trial of a smart workshop software like Katana to judge see how various daily tasks could be automated and maybe save you time and money. Also, make sure that the trial is done by the person who will use the product to know whether it’s user-friendly or not. Remember, a tool that is liked by you as a business manager might not be liked by your project manager. So, keep your team in mind while taking any such decisions.