E-commerce is the fastest growing retail market and is projected to hit $4.058 trillion in sales in 2020. In 2018, e-commerce sales are expected to reach a share of 18 percent of all retail sales in the UK. So why has e-commerce grown so rapidly over the last couple of years?
There are 3 types of e-commerce: B2B (business to business), B2C (business to consumer) and C2C (consumer to consumer). Businesses in these areas are taking advantage of the benefits of e-commerce, the main ones of which are as follows:
Maintaining a physical bricks and mortar business and hiring staff is expensive. The main cost of running an e-commerce business is product storage. Dropshipping is an even more cost-effective option. Dropshipping businesses provide products by direct delivery from the manufacturer to the retailer or customer, as storage is not necessary. The saving in operational costs means that e-commerce businesses are able to offer their customers better discounts and deals.
A business in a physical location is limited to supplying customers in its geographical area only. An online store, however, has the potential to supply customers worldwide, broadening its market dramatically. And, of course, working from anywhere, is a major attraction for business owners. With a laptop and an internet connection, you can manage your business from anywhere in the world.
An online business never closes. It can operate around the clock 365 days a year. This is one of the main advantages of e-commerce. For the business, it dramatically increases sales opportunities, and for the customer, the store is available at any time of the day or night.
E-commerce businesses can automate many of their systems, saving much time, money and effort. These systems are inventory management, order-taking, payment processing and accounting. These automated systems can be integrated for maximum benefit, saving businesses a fortune.
E-commerce businesses capture a wealth of customer information. They can use this information to keep a track of customer buying habits, product and industry trends, as well as using it to inform their marketing efforts. Their customers benefit by receiving a more tailored experience, especially considering the e-commerce business can address them by their first name in communications with them.
A bricks and mortar business with a niche market is difficult to scale up. A niche online business, on the other hand, can go global from the outset and with no further investment needed.
For help setting up your online store, contact us on 01785 244080, or contact us here.
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For more information about accounting software, click here.