Each year more people are taking the exciting leap into entrepreneurship through e-commerce — and it’s easy to see why. In the UK alone, e-commerce sales are tipped to hit a whopping £148.89 billion by 2024, up from £104.92 billion in 2019.
Once you’ve chosen a profitable product, executed a killer launch, and bagged some loyal customers things should be smooth sailing, right?
Not exactly.
Running a growing e-commerce store in today’s ultra-competitive arena is no easy feat. From managing budgets to swatting off competitors, there’s always a new challenge to watch out for.
While business trials and tribulations are par for the course in any industry, they can make your e-commerce journey that much more difficult. And it can be hard to see them coming.
In this post, we’ll shed some light on the most common problems sellers and brand owners encounter as they grow, plus share proven tips to help you overcome them as you scale your brand.
Don’t let cash flow challenges block your store’s progress.
If you’re here, you’ve probably been ruthlessly focused on building your brand.
Your advertising is dialed-in, your customers are loyal, and your product quality is consistently awesome. Congrats!
Problem is, once you hit the $1 million and up the milestone, things can quickly start to feel a little more complicated — but don’t worry.
Many an online retailer has experienced these same challenges. Learning from their mistakes can help you know what to expect.
Let’s take a closer look at some of the most common problems you can encounter on the rocky road to scaling an online retail business.
If there’s one thing we’ve learned since the pandemic, it’s that e-commerce is sensitive to society’s twists and turns.
Case in point? When lockdowns took effect worldwide, Amazon stopped allowing non-essential goods into its warehouses.
This was great news for the sellers stocking essential items, except for the part that required them to quickly find ways to stay in stock — a huge challenge as many factories temporarily closed due to global lockdowns.
At the same time, sellers with non-essential items had to switch to self-fulfillment simply to remain in stock — which created additional work and costs, especially for stores outside their home territory.
As a growing brand, you may not have the same buying power or track record your larger competitors have.
When peak sales times or (heaven forbid) disasters arise, it can be difficult to secure production and favorable payment terms without overcommitting to units and services.
To work around this problem, you’ll need to develop great relationships with your suppliers and vendors — but it’s going to take time and effort until you’re seen the same way the bigger players are.
One thing established brands have over their up-and-coming competition is buying power.
And while it’s seriously uncool to use this kind of leverage to get a one-up on your competitors, the truth is it happens.
The fact is, bigger stores can buy more products for less. Of course, this means they can also pass down the discounts to their customers at rates newer businesses would struggle to maintain.
Without a solid differentiator like a unique product line or excellent customer service, it’s hard to take on these big stores and win.
Managing your store’s finances can be challenging at the best of times, but this is especially true when you’re waiting for your Amazon payouts.
If you’re in the enviable position of having more business opportunities than liquid cash, you’ll need to think as the big players do.
Whether it’s negotiating better payment terms with suppliers or working to improve your cash conversion cycle, it’s going to become important to level up your working capital.
Psst! Did you know you can access up to 90% of your incoming sales using our flexible Daily Advance solution? In fact, Daily Advance sellers see an average 75% increase in growth!
There’s no sugarcoating it: The challenges for growing brands are real.
But no matter how far along your store is in its e-commerce journey, it’s important to dream big and aim high.
Because despite the challenges of being a smaller fish in a massive e-commerce pond, the right strategic moves can help you bypass common hurdles and gain the top spot in your niche. 🏆
These straightforward steps will help you build resilience and flexibility with every new growth level.
Affiliate collaborations, influencer marketing, blogging, and social media are all great ways to get noticed.
But to attract your dream tribe, boost sales, and drive profits you’ve got to get to the root of what makes your brand different. Amplify these characteristics in your marketing and use them to make your mark — no matter how noisy your niche.
For example, if your brand is priced higher than your larger competitors because it uses sustainably sourced materials to produce goods, you could drive home your brand’s eco-conscious nature to attract your target customers while transparently justifying your higher price points.
Whatever you have that they don’t, be sure to use it to your full advantage.
Presales can be your store’s best friend in its startup phase and beyond.
Not only do presales validate your product ideas — they can also help you secure the cash flow needed for your initial production run. So, get creative.
Use your presale strategy to test out new product ideas, tap into new audiences, and maximize your store’s liquidity.
For example, say you sell craft beer. You could test:
All without breaking the bank and putting yourself in a less-than-favorable position compared to the bigger players in your niche. 😉
As mentioned, it can be tough to offer steep discounts like the big box stores.
But don’t worry.
You can still get ahead by adding more value to your customers’ lives. Stay on the lookout for areas where you can fill in knowledge gaps, make customers feel special, and build exclusivity into your business.
For example, you could create:
Social media is an awesome way to build the kind of trust-based relationships bigger competitors have trouble maintaining. Plus, no matter how busy you are, it pays to invest time and energy into your brand’s social shopping potential as you scale.
To ensure your social channels keep your dream customers coming back for more, run a quick self-audit using these key questions:
As your store grows, you’ll need healthy cash flow to support larger inventory orders, freight, marketing, and more.
But not all funding will be suitable for your expansion. Take time to get to know your e-commerce funding options and research which one can best reinforce your cash flow.
Here are some of the top funding options you may want to think about:
While the struggles are definitely real, one of the best things about being a growing e-commerce business is you can adapt to customer wants and needs faster than your larger competitors.
Use these traits to your advantage.
With the right strategy, you can scale your store to the next level just as well as (if not better than!) even the biggest players in the market.
So get started today! Upgrade your customer service, zoom in on your customers’ desires, and get the funding you need to grow your business on your terms.
Ready for flexible funding you can count on? SellersFi is here to help.
