How to Increase your Ecommerce Profits

The UK spent a record 68 billion pounds online in 2011, up by 16% on the previous year, according to the retail consultancy, Capgemini. Pretty amazing isn’t it?

And it’s only likely to keep increasing as consumers opt for the added convenience and choice that the online environment delivers, over the hassles and limited options that physical stores can bring.

What can you do, I hear you wondering, to get a bigger piece of that 68 billion pound pie? Here are a few ideas to get you started.

Think about subscription ordering

Guess what? Subscription ordering isn’t just for magazines, books and newspapers. Numerous sellers are now selling other items, such as beauty products, footwear and contact lenses.

In order to do this successfully, you must figure out whether your market actually would want to subscribe to your products. You must also ascertain whether your supplier can realistically provide a consistent stream of products to meet demand.

Cut costs where possible

The start of the financial year is a great time to reassess your business operations. Start by looking at your stock and culling items that are low or no sellers. Consider getting rid of stock that generates low profit, so that you can make room for the more popular and higher profit generating items.

Another way of cutting costs is by renegotiating with manufacturers. It’s worth giving it a try, because if you don’t ask, you don’t get.

Have another look at your shipping costs and see whether you can improve the costs of delivery. And always monitor them to ensure they are meeting delivery targets. If they aren’t, you need to penalise them as per your agreement.

Expand on your product range

After culling items that aren’t popular and generate low profits, you can then start to expand again with new and different items. A good variety of goods that are in demand will always keep current customers and create new ones.

Offering original, exclusive items will put your store ahead of the rest. Find your most popular items and add similar ones. Lastly, think about asking your customers directly what products they would like to see on your website. You can’t beat helpful feedback. That way your customers feel respected and you get more sales.

The more effort you put in to cutting your costs, the more profit you will generate.

Article provided by Alina on behalf of Shopify ecommerce platform

Leave a Reply