Results for 'ecommerce fulfillment'

DIY Efficient Ecommerce Order Fulfillment

Not every ecommerce store is big enough to require the services of a fulfillment center like ShipWire, or…

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Not every ecommerce store is big enough to require the services of a fulfillment center like ShipWire, or Amazon Fulfillment. Many Shopify merchants handle the packaging and shipping of orders themselves. DIY order fulfillment means you have substantially more control over the process, and you should constantly work to optimize your workflow. 

Here are six tips you can implement to help make your fulfillment as efficient as possible.

1. Set Up a Routine

Get into the habit of fulfilling orders on a regular schedule. If you fulfill orders everyday, make sure to do it at the same time each day. This helps take away the drudgery that many people feel when fulfilling orders. When you do it the same time each day it becomes a task like brushing your teeth, after a while it just's second nature. This becomes particularly useful when you need to get other things done during the day. Block off a set time when you handle fulfillment and make sure to get it done during this time. Like any other task, having a set timeframe to finish your packaging will make you work more quickly in order to finish on time. 
Another advantage of fulfilling orders based on a set routine is that you will feel generally more confident that your orders were shipped correctly. When you are rushing to ship out a bunch of orders you've been putting off for a week or two, it's easy to overlook something. When you fulfill and ship your orders on a regular cycle, you can feel confident that everything has gone smoothly and no one was forgotten.
Fulfilling orders is a skill just like any other. People rarely become great at something by putting bursts of effort in every couple of weeks. We learn to be better by consistently performing the task at hand. Keep to the routine and it will certainly pay off. In no time, you will be fulfilling orders like a pro.

2. Don't Let Special Requests Bottleneck Your Flow

If you are packaging a large number of orders, you'll surely get into a good flow. This is when your efficiency is at it's peak and you should do whatever you can to avoid disturbing it. Don't let special requests or weird orders bottleneck your fulfillment flow. If you have to leave your fulfillment zone, spend an excessive amount of time, or any other activity that will put a kink in your packaging rhythm, skip the order and return to it once all of the regular ones are finished. When you have to switch mind sets to complete little tasks required by outliers you greatly decrease your efficiency. 

3. Define Your Workspace

It's hard to be as productive as a fulfillment center since you don't have a warehouse dedicated to the task at hand. You can help level the playing field by creating a designated space for you fulfillment tasks. It's terribly difficult to package orders if you have to move things from one side of you couch to the other. This doesn't mean you need to own a dedicated office just for fulfillment. What you need to do, though, is clear off enough space to comfortably do your packaging before you start. Eliminating the obstacles that force you to fall out of your packing rhythm will instantly increase your efficiency.

4. Study Your Fulfillment Process

Every step in the fulfillment process is an opportunity to make it even more efficient. This is the secret to insanely efficient organizations. They actively spend time identifying weak points and make noticeable improvements whenever possible. The more you are conscious of the steps required to complete your oder fulfillment, the greater the chance of improving it are. Make it your goal to refine something each week and you will see the improvements in your order fulfillment in no time. 

5. Grab a Friend

If at all possible, you should find someone to help you with your fulfillment duties. Nothing makes a not-so-appealing task seem even less glamourous than being the only one who has to complete it. Having more than one person fulfill orders also reduces the likelihood of taking excessive breaks and loosing focus. When there are multiple people working on packing orders, no one wants to be the person slowing down the process. 

6. Try Using a Shopify App

If you're a Shopify merchant, there are plenty of apps available to make DIY order fulfillment easy. For example, PixelPrinter is a free lightweight option that generates and prints invoices and packing slips and other documentation needed for shipping.

Shipwire opens a new Canadian warehouse

At the beginning of this year we added support for Shipwire order fulfillment to Shopify. If you are…

At the beginning of this year we added support for Shipwire order fulfillment to Shopify. If you are still manually picking, packing, and shipping your orders then you definitely need to take another look at Shipwire. Even more so if you are expecting a big holiday surge of sales, and you don’t know if you can handle the volume. shipwire.com has also been given a fresh new look just in time for the holidays.

Better yet, is that Canadians can now get in on the pain-free fulfillment solution that Shipwire offers by sending goods to their new Canadian warehouse in Toronto, Ontario. Utilizing Shopify for your ecommerce software, coupled with our dead simple Shipwire order fulfillment integration really can help remove the stress from your holiday season.

Inside An Ecommerce Entrepreneur's Brain

Running a successful ecommerce business requires a special set of skills. Whether it's SEO, social media, customer service,…

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Running a successful ecommerce business requires a special set of skills.

Whether it's SEO, social media, customer service, shipping and fulfillment or email marketing, often you need to be a jack of all trades.

What are some of the areas you find yourself spending the most time on in your business? Do you think all of these tasks belong here? Are there any we missed? Let us know in the comments.

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Attention Contract Developers: Shopify Wants You!

Shopify has some big customers with online stores that need apps written for them. We've been getting a…

Shopify has some big customers with online stores that need apps written for them. We've been getting a lot of custom work requests from customers who need applications for their ecommerce website's fulfillment workflow - that is, making sure the right things get put into the right boxes, and sending them to the right people for the right price. We also get requests for other things that online shops need: analytics, promotions, CRM-integration-jazz, or some kind of automatic client-retention. But for now, I'd like to talk about fulfillment.

Fulfillment: it's that part of the shopping cart transaction where the order has been placed and paid for, and now it's time to send something to the customer. This sort of app is a web application that will typically talk to a couple of APIs:

  • The Shopify API, which will have the relevant data from the shop, most notably information about the order that was placed,
  • Webhooks (see Dave Underwood's Syncing with a Store tutorial in the Shopify Wiki to find out what they are. Webhooks are used for about 90% of all Shopify apps),
  • and some fulfillment API, which the app will use to get the order to the customer.

If you're looking for some contract programming work writing software that does useful stuff for reliable customers and you're a reliable, responsive type who can be counted on to write stuff that people need to make their businesses go, Shopify would like to pay you for your services. The application you're writing will be interacting with APIs, which means that you're free to use the programming languages, frameworks and technologies you prefer, as long as you can solve the problem. And because this project is about fulfilling ecommerce orders and not socially networked cat pictures, this  contract will pay nicely.

Is this the sort of development you can do? If so, drop me a line at joey@shopify.com and let's talk.

This article also appears in Global Nerdy.

Spare Change, 04/01/08 edition

Welcome to the latest version of Spare Change, the rebranded “ecommerce roundup”. As usual, here’s where I bring…

Welcome to the latest version of Spare Change, the rebranded “ecommerce roundup”. As usual, here’s where I bring you all the latest interesting ecommerce news on the vast Web.

Tech News World has posted an article on E-Marketing: Cashing In on MeCommerce. They see “a mashup between ecommerce and social networks as the Holy Grail for members, advertisers and social networks.

“The demographics of the social networks are changing; the relationships between the members are changing; and thus, the applications from the developer communities on social networks are changing. New breeds of social networking widgets are giving social network members the opportunity to instantly participate in ecommerce without the headaches of back-end fulfillment such as payment processing, fulfillment and customer service. People naturally seek out products and make buying decisions based on recommendations from their friends, not necessarily from third-party banner ads and advertising placements. The ability to create a fully ecommerce-enabled site for total transaction management, all without any involvement from the user’s perspective, is a new way to conduct ecommerce. It’s more like MeCommerce, from me to you, with a plethora of vendors’ products to recommend on your social networking profile.” Read the rest at Tech News World.

Credit Crunch is a Boost for ecommerce, according to Simon Crisp, director of Shopsafe.co.uk, who notes that consumers are “increasingly searching for bargains online in a climate of restrictive lending conditions.” Consumers are “looking to squeeze every penny out of their budget”, and ecommerce vendors are responding with discount codes and vouchers “that cut prices by ten or 15 per cent, he explains, noting the importance of such strategies as funding conditions grow increasingly stringent.”

HeroTurko.net has come up with a list of "20 of the best ecommerce websites". They list their picks for “well designed, standards-compliant Ecommerce stores. These are a tricky site to get right and design can give way to conversions, which is after all, the reason they are there – to make money.” What do you think of their picks?

Finally, ecommerce guide has published a very valuable guide for this time of year: a Guide to Making Online Sales Tax Compliance Less Taxing. For those of you in the USA, this may be an exceptionally useful – and well timed – article.

Got any recommendations for Spare Change? Email me at shannon at jadedpixel dot com!

How One Man Listened to His Community, Then Built a $40k Per Month Ecommerce Business in Under a Year

Eric Bandholz has one serious beard. And he's not alone.  Just look around any major urban center these…

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Eric Bandholz has one serious beard.

And he's not alone. 

Just look around any major urban center these days and you'll see more beards and mustaches than ever before.

In fact, beards, mustaches, barber shops and male grooming in general are all undergoing a major renaissance right now. Especially with Movember in full swing.

Being a member of the beard community (and blogging about it), Eric was aware of this demand and realized he and his peers we're being underserved both from a content and product standpoint.

So he decided to create Beardbrand

Since launching the site this past January, Beardbrand has built a loyal community, has been featured in the New York Times, and is off to a racing start. 

I was lucky enough to catch up with Eric and ask him some questions about how he's achieved his amazing success in such a short period of time. 

Describe your business and product(s) in 1-3 sentences.

Beardbrand fosters style for the urban beardsman. We sell beard care products as well as other items associated with the bearded lifestyle. We are located in Spokane, WA with customers globally.

How much revenue are you currently generating per month?

We launched on January 28th, 2013 with only 3 products and no established sales. We've grown from $1000/month to most recently $40k in October and we are on pace for $60k in November. With the exception of March, we've seen growth each month.

How did you come up with the idea for your business? What kind of market research did you undertake?

I had actually launched Beardbrand as a blog / community in February 2012. I talked a bit about beard care, the lifestyle, and always had a vision to build the business.

Beardbrand was formed after I attended the 2012 West Coast Beard & Mustache Championships in Portland, OR. I had an absolute blast and I realized there is a community of like minded individuals that wasn't being serviced.

Not one to wait; I created Beardbrand. I didn't do any formal market research other than becoming immersed in the community. We are entirely bootstrapped, and our startup costs have been extremely low. We are growing organically and because the risk for loss is so low the need for market research isn't needed. I suppose that our entire business is the market research.

Because I have been blogging about beard care products for a while I have had access to products on the market. I contacted a manufacturer of beard oil and mustache wax and asked if he was interested in wholesaling his product and he was. We made a very small initial investment and grew from there.

Because we don't drop ship, we haven't added all the products under the moon. It's been slow, deliberate growth and we are really focusing on high quality products that our customers will love.

How did you create, manufacture or source your product(s)? What were some key lessons you learned during this process?

We spend a lot of time on social media platforms and have found that Tumblr is a great source for product ideas.

We partner up with other smaller, quality manufactures as well as building our own products. I am a designer by trade so I've been able to develop a lot of the product design and labeling for our products.

The hardest part of this process is figuring out which companies are able to handle your growth. I still feel like we are doing very small volumes and it is a bit frightening if we want to add another zero to our monthly revenue that our vendors won't be able to handle it. It's a good problem to have, I suppose.

How did you promote your business initially and where did your first sales come from? Any major media mentions or PR wins since then?

Well, we really got lucky with Beardbrand. I had been contacted by a reporter from the NY Times about beard care products. A few friends and I were trying to figure out what business to startup and I mentioned we could turn Beardbrand into a store with the article from NY Times coming in. So we were able to hustle and launch our store one day before the article posted. It resulted in a nice initial boost - but wasn't like a Niagara Falls worth of business.

Since then my face has appeared on the front page of Yahoo, we have been mentioned by a few celebrities, and sold to Mike Napoli of the Boston Red Sox. In fact, we think our beard oil is part of the reason they won the World Series. We just hired a Public Relations Manager so we are hoping to get even more coverage in the future.

What channels are currently generating the most traffic and sales for you right now?

Social media has been good to us and we get a lot of our business from YouTube and Facebook. It's hard work creating valuable videos - but it's much needed in the community. We are purchasing a good bit of advertising on Facebook and have found that it drives a lot of visitors to our website.

How do you handle shipping and fulfillment? Key lessons/tips for doing this successfully?

Our shipping and fulfillment has been a dream for us. We partner up with a local business - Pacific Northwest Print & Fulfillment and they handle our fulfillment. We decided early on that our skills are best put toward marketing and connecting with our clients. It was important for us to outsource things that we don't want to master. Pacific has been great in that they were willing to work with us when we were really small and have grown with us as well. Our clients get their orders super fast with everything in tact.

We do pay more for the company to handle the fulfillment for us, but I think it's totally worth it. If we didn't do it; I'd be sitting around in a warehouse labeling orders and sending them out. We have visions to grow large, so it's not wise for me to spend my time managing that process.

What software, tools and resources are crucial to your business?

To stay connected with my business partners and manage our vendor and customer list we use Podio and Google Apps. Those two pieces of software are the backbone of our business.

The ShipStation app for Shopify is really a fantastic app and makes shipping really easy for our fulfillment house. Beyond that, we have had success with a contest management software called Gleam.

In addition, I've found that the Reddit Entrepreneur subreddit has been a great resource for the growth of Beardbrand. Subscribers to that subreddit have provided very valuable feedback to our business. They're a big part of why we have grown the way we have.

What were your biggest mistakes or wastes of time and money?

Nothing is a waste of time or money unless I didn't learn from that move. Part of doing business is making decisions that you don't know if it will be successful or not. As long as we are learning from those investments; it's not a bad move. That being said, I think I would try to hire help sooner than later to take things off my plate.

What other key advice can you offer to entrepreneurs looking to start a successful ecommerce businesses?

I really thing one of the most important things is showing the person or people who are behind the store. Tell the story of why you are building the business and why people should purchase from you. You won't ever be able to win on price; so build that personal presence.


Are you a Shopify merchant with a success story you want to share? Head over to Shopify Stories and tell us about your business!

Drop Shipping: The Easiest Way to Sell Online

Many people shy away from starting an online store because of the startup costs and fulfillment hassles. But…

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By Andrew Youderian, ecommerce store owner, eCommercefuel.com

Many people shy away from starting an online store because of the startup costs and fulfillment hassles. But imagine if someone offered to pay your up-front inventory costs on thousands of items and manage your fulfillment operations. It'd be much easier to get started, and you could run your business from anywhere in the world. Sound too good to be true? It's not, if you know about drop shipping. 

In this article, I'm going to teach you all about drop shipping. I'll go over a simple definition, list the benefits, show you how to find drop shipping wholesalers, and give solutions to some common problems associated with drop shipping. 

Update: I wrote a extremely comprehensive (and free) guide to drop shipping. Be sure to check that out here as well

What Is Drop Shipping? 

Drop shipping is a retail method in which you don't keep products in stock. Instead, you partner with a wholesale supplier that stocks its own inventory - you transfer customer orders and shipment details to them, and they ship the goods directly to the customer. The biggest benefit of drop shipping is you don't have to worry about fulfillment or inventory issues. 

Also, most customers don't know you're drop shipping, since "private label shipping" lets you ship from the wholesaler with a return address and invoice customized to your ecommerce store.

The Benefits of Drop Shipping 

There are a number of reasons you should consider drop shipping:

1. You Don't Need Buckets of Money: Drop shipping makes it amazingly easy to get started selling online. You don't need to invest heavily in inventory, yet you can still offer thousands of items to your customers. 

2. Convenience & Efficiency: Successfully launching and growing an ecommerce business takes a lot of work, especially if you have limited resources. Not having to worry about fulfillment is incredibly convenient and frees up your time to concentrate on marketing, customer service, and operations 

3. Mobility: With all the physical fulfillment issues handled, you're free to operate your business anywhere you can get an internet connection.

4. It's a Trusted Model: You might be thinking that this sounds like some sketchy, fly-by-night model – but it's not. Plenty of Shopify online stores, even major retailers like Sears, use drop shipping to offer a wider selection of products to their customers without having to deal with increased inventory hassles.

How Do I Find Drop Shipping Wholesalers? 

Before contacting suppliers, you'll want to make sure your legal ducks are in a row. In the United States, most suppliers will ask for your business EIN number and a copy of your state sales tax and/or resale certificate. Once you're properly established, you can start contacting drop shipping suppliers. 


There are various ways to find drop shipping wholesalers, and the video below outlines your options:

If you already know what products you'd like to drop ship, contacting the original manufacturer is the easiest way to find qualified distributors. Not all distributors will be willing to drop ship, but it will give you a list to follow up with. Unfortunately, the market is littered with scams and low-quality information. If you do decide to invest in a directory, I can recommend the paid directory World Wide Brands as a reputable source of drop shipping wholesalers - but it's still very important to exercise caution.

Google can also be an effective tool for finding drop shippers, but you need to keep a few things in mind. 

3 Ways to Use Google to Find Wholesalers 

1. Search Extensively: Wholesalers and drop shippers are notoriously bad at SEO and marketing, and usually aren't going to pop up on the first page of Google for a term like “handbag wholesaler.” Instead, you'll need to dig deep into the search results, often going through 10 or 20 pages of listings.

2. Don't Judge by the Cover: Suppliers also tend to have outdated, late ‘90s-era websites. So don't be scared away by abysmal design and layout. While a sleek, modern site could signal a great supplier, a low-quality one doesn't necessarily indicate a bad one.

3. Use Lots of Modifiers: As you hunt for suppliers, don’t stop with a search for “wholesale” - make sure to use other modifier terms, including “distributor” , “reseller” , “bulk” , “warehouse” and “supplier.”

4 Common Problems With Drop Shipping 

Despite my glowing recommendation, drop shipping isn't ecommerce nirvana. Like all models, it has its weaknesses and downsides. With some planning and awareness, these issues can be managed and need not prevent you from running a successful drop shipping business.

 

1. There will be loads of competition and awful margins.

Solution: It's true. Products that can be drop shipped will spawn a lot of competition. Usually this will lead to cutthroat pricing and diminishing profit margins, making it hard to build a viable business. 

To be successful, you typically can't compete on price. Instead, you'll need to offer value in a different way, usually through top-notch product education, service or selection. For more information on how to pick a profitable niche and add value, see these posts on finding a product to sell andthe anatomy of a profitable niche

2. Syncing inventory is difficult & leads to out-of-stock items.

Solution: The best way to mitigate this problem is to work with multiple suppliers with overlapping product lines. It's inherently dangerous to rely on a single supplier. Having two suppliers doubles the likelihood that an item will be in stock and available for shipment.

Many sophisticated suppliers offer a real-time product feed, and you can use a service like eCommHub to easily sync your Shopify website with the warehouse.

Eventually, you’ll sell a customer an out-of-stock item. Instead of canceling the order, give the customer an upgraded product for free! You might not make much – if any – money on the order, but you'll likely build a loyal brand advocate.

3. It's hard to sell products that you never see.

Solution: In today's world, it's possible to become an expert in just about everything through information online. Selling products from manufacturers with detailed websites will allow you to become intimately familiar with a product line without ever having touched a physical item. And when you do need to answer specific question about a product, a quick call to your supplier or manufacturer will give you the answer you need. 

You can also buy your most popular items to get acquainted with them, and then resell them as “used” or “refurbished,” often recouping most of your investment.

4. Involving a third party will result in more fulfillment errors, mistakes, and logistical problems.  

Solution: Even the best drop shippers make occasional mistakes, and mediocre ones make a lot of them. Suppliers are fairly good about paying to remedy problems, but when they're not, you need to be willing to spend what's necessary to resolve the issue for your customer. 

If you try to blame your supplier for a fulfillment problem, you're going to come off as amateurish and unprofessional. Similarly, if you're unwilling to ship out a cheap replacement part to a customer because your supplier won't cover the cost, your reputation is going to suffer.

One of the costs of drop shipping convenience is the expense of remedying logistical problems. If you accept it as cost of doing business – and always make sure to put your customer first – it shouldn't be a long-term issue.

The Final Word on Drop Shipping 

Is drop shipping the path to overnight ecommerce success? Of course not. As with any successful online store, you'll need to invest over time in a quality website, marketing, and customer service.

But drop shipping does provide an easy way to get started and the ability to leverage other people's capital without having to invest thousands of your own. When managed correctly, it can form the foundation of your own successful online store.

Further Learning

Looking to learn more about drop shipping? Check out our "Ultimate Guide to Dropshipping" - a free comprehensive guide that covers everything you need to know about building and running a successful dropshipping business. 


By Andrew Youderian, an ecommerce entrepreneur and the owner of numerous online stores. You can learn how to create a profitable online store with his free 55-page eBook or find out more about drop shipping on his blog, eCommercefuel.com.



Shopify App Store Showcase: 9 Exciting New Apps

Welcome to the first edition of the Shopify App Store Showcase. If you don't know already, The Shopify App Store is…

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Welcome to the first edition of the Shopify App Store Showcase. If you don't know already, The Shopify App Store is a collection of plugins (apps) that extend the functionality of your ecommerce store. We've got about 150 apps for online store owners to choose from and we're adding new ones every week. Here are 9 exciting new Shopify apps along with a special featured app at the bottom: 

OrderlyPrint

Free for 7 Days, $4.99 / Month

Easily retrieve hundreds of orders from your store and print all your invoices, address labels, packing slips, and picking lists. You can filter, view, and print up to 250 orders at a time.

WordWatch

Free for 30 Days, Free - $399 / Month

Automatically manage your Google AdWords keyword bids. You'll get more clicks, and more conversions while it's constantly reallocating your budget 24/7.

BlogFeeder

$3.99 / Month

Migrate or mirror your existing blog into Shopify. Just toss in any RSS or Atom feed, and it will feed directly into your store's blog.

ActiveCampaign

Free for 30 days, $9.00 - $225 / Month

Email marketing campaign manager. Design and send beautiful emails with ease. ActiveCampaign is fully equipped with automation, reporting, and analysis.

Lockdown

Free for 7 Days, $5.00 / Month

Create members only areas in your online store for customers to enjoy exclusive access to blogs, pages, or products. This is perfect for merchants that want to have a special section for wholesale customers.

wyVox

Free for 30 Days, $7.95 / Month

Add a customizable widget to your storefront that allows customers to establish a voice call to you or your support team. You'll be able to receive the calls in your web browser.

Mineful

Free for 14 Days, $35 / Month

Segment customers and optimize your email marketing campaigns. Instead of mass emailing everyone on your list, you can deliver specific messages to certain customers.

Action Shots

Free for 14 Days, $8 - $45 / Month

Allow your customers to add their own pictures to your storefront. This is great way to engage customers and display your products "in action." 

Happy Ending

$2 - $15 / Month

Customize your thank you page to include social media hooks and a personalized message. Give your customers a great send off and thank them for shopping with you.


Featured

Bulk Fulfillment

Free - $20 / Month

Select and fulfill specific line items or entire orders. You can fulfill hundreds of orders quickly and easily, and it works perfectly with fulfillment partners like Shipwire and Amazon.

The Pros and Cons of Selling on Amazon and eBay

At first glance, online marketplaces like Amazon and eBay seem to be a creation of mutual benefit. Ecommerce…

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At first glance, online marketplaces like Amazon and eBay seem to be a creation of mutual benefit. Ecommerce store owners gain increased exposure for their products, and the marketplaces gain an expanded product range without having to increase inventory.

On closer inspection, the mutual benefits remain, but the reality is more nuanced. Should you expand your presence beyond your online store and start selling your products on Amazon and eBay?

The answer is... it depends. A marketplace strategy may be a boon for some retailers and a bust for others. There are a lot of variables that need to be taken into consideration, including the type of products you sell, the intensity of competition in your category, marketplace fees and restrictions, and so on.

There are, however, some pros and cons that apply across the board. In this post, we’ll explore those pros and cons, so you can make the decision of whether or not to sell on marketplaces well-informed as to the upsides and the downsides.

Pros of Selling on Amazon & eBay

1. Increased Sales

The chief draw of selling on marketplaces such as Amazon and eBay is the scale of their online presence. Amazon alone draws nearly 85 million unique monthly visitors - that’s a heck of a lot of eyeballs! And those eyeballs can translate into higher sales volumes. According to an Amazon executive, sellers report an average 50% increase in sales when they join Amazon Marketplace.

2. Customer Acquisition

Nobody visits Amazon or eBay searching for your store. But they may be searching for - and discover - your products. Products they may not have discovered otherwise, or that they may have purchased from a competitor.

Once you’ve got a customer in the door, even if it is through a marketplace, you’ve got a chance to win repeat business through excellent service and fulfillment. This is especially the case if you’re selling products in a category that encourages frequent, repeated purchases such as hobby supplies or fishing gear.

3. Marketplace Infrastructure

Marketplaces are all about strength in numbers. This is as true for online marketplaces as it is for real world examples like farmers’ markets, shopping malls, and food trailer parks. The variety and all-in-one aspect of the marketplace can draw in lots of customers who prefer that kind of shopping experience. Online marketplaces also bring the additional layer of single-stream checkout and fulfilment support in order to create a seamless experience for buyers.

Cons of Selling on Amazon & eBay

While there are some significant upsides to selling on marketplaces, there are also some drawbacks that need to be considered.

1. Marketplace Fees

Setting up shop on a marketplace can potentially supercharge your sales, but it also exposes you to another cost center - marketplace fees. Most marketplace fees are deducted as a percentage of each sale, and can vary from site to site and even category to category. Before selling your products on a marketplace, you’ll want to make sure you have a good sense of your margins and a firm understanding of the marketplace’s fee structure. In highly commoditized, low-margin categories, the numbers may just not add up. See fees for selling on Amazon, and fees for selling on eBay.

2. Marketplace Infrastructure

While the marketplace infrastructure has many advantages, it’s important to remember that it can cut both ways. Marketplaces don’t exist to help you, but to help themselves. They want the focus to be on the products, not the sellers. And that means they might restrict the degree to which you can brand your presence, communicate with customers, dictate what items you can and cannot sell, and so on. 

Additionally, there’s nothing to stop marketplace owners - in the case of Amazon, Sears, and so on - from “going to school” on third-party sellers, identifying popular products and stocking them themselves.

3. Keeping Inventory in Sync

A marketplace is essentially a second point of sale. And one that sometimes can’t be configured to talk to your shopping cart. In effect, both draw down the same inventory, but don’t sync with one another, making it challenging to understand your stock levels without lots of manual reconciliation. Fortunately, applications exist to help you aggregating orders from multiple sources and making sure your inventory stays in sync across all your stores. 

How to Choose a Marketplace

As you weigh the pros and cons of selling on a marketplace, it’s also worthwhile to consider which marketplace you would join. The tempting answer is “all of them!”, but each marketplace has its own system, its own processes and limitations and quirks. Learning to navigate those can take time you probably don’t have, so it’s best to stick to one or two marketplaces unless you know you can support more. 

Two of the largest and most well-known marketplaces are Amazon and eBay. Amazon’s Marketplace takes the sharper retail tack, and as a retailer itself Amazon provides tools to help third-party sellers become part of a seamless shopping experience, including “Fulfillment by Amazon”, which involves shipping your inventory in bulk to Amazon and letting them handle shipping.

eBay, on the other hand, is essentially a massive marketplace. Where Amazon focuses on the Amazon shopping experience, eBay offers seller tools and features that make it easier for you to feature your brand, as well as sell non-standard items.

Other Ways to Make Sales

 

Check out our free guide on 50 Ways to Make Your First Sale.


Article by Matt McDougall, Director of Marketing for Ordoro, a comprehensive order and inventory management solution for online retailers. Ordoro is available in the Shopify App Store and has a free 15 day trial

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