Failure to Launch: the eCommerce Scaling Problem

In this post, we’re addressing the eCommerce challenge of improving scalability and how to solve it profitably.

The 2006 film Failure to Launch, starring Matthew McConaughey and Sarah Jessica Parker, centred on the difficulties of easing an adult son out of the parental home. In an eCommerce context, failure to launch is about the challenges of profitably growing the business as it expands in sales, channel coverage and complexity.

Here we touch on six areas where the eCommerce scaling problem manifests itself, and what to do about it.

1. Managing listings and stock

Managing inventory across multiple sales channels is a daunting task. Many Volo customers approached us initially when they found the addition of a second selling channel doubled their workload. With products to be listed on various platforms like Amazon, eBay, your own webstore, and social media marketplaces, keeping track of listings and stock levels and updating them in multiple places becomes increasingly arduous. The results of poor inventory synchronisation can be overselling, stockouts, or excess inventory, which can kill customer satisfaction and your bottom line.

A robust listing and inventory management system can provide real-time visibility and synchronisation across all your selling channels, ensuring accurate and optimal stock levels (and happier customers).

2. Handling order fulfilment and shipping

Efficient order fulfilment is what is closest to your customers’ hearts, but this becomes more challenging when you’re dealing with multiple separate channels. Each channel may have different fulfilment requirements, shipping options and return policies – all of which can lead to a very complicated set of rules governing which carrier ships which orders to where.

A centralised order management system can bring together your orders from all channels into a single interface. This streamlines the fulfilment process, ensuring consistency and efficiency across your own warehouse, your drop ship providers, and 3PL partners.

3. Integrating and reporting on data

Scaling across multiple channels and multiple suppliers – each with their own different formats and qualities of product information – generates a vast amount of data from various sources which needs to move through your own systems. Bringing this data together can be challenging. Disparate data systems and standards can lead to incomplete reporting and make it difficult to see your true performance.

Invest in a system that can automate the receiving and sending of data feeds from all sales channels and other partners in your eCommerce ecosystem. This allows you to better monitor what’s important to you and gain a window on how your business is really doing. To scale your business profitably, advanced analytics tools can help you identify trends, optimise marketing strategies and make good decisions.

4. Delivering a uniform buying experience

Providing a consistent and seamless customer experience across all channels is essential for building brand loyalty, but this is very challenging when the marketplaces you sell on own the customer relationship and buying journey. These marketplaces vary between themselves and your own webstore, in terms of look and feel, delivery standards and returns policies.

Where are you looking to grow the business? Which channels are most profitable and/or easiest to work with? Where possible, keep your customer service standard and messaging as consistent as you can, and do a good job of controlling the things that you can control, like the quality of your listings, information, and everything about your webstore(s).

5. Dealing with channel-specific rules

A barrier to success for you on any marketplace is learning how each one works and what its rules and regulations are. This can be very time-consuming, particularly for businesses operating in multiple regions or countries, and those experimenting with new additional channels that may only offer small incremental revenues at the outset.

If you invest in a system provider like Volo ERP, which centralises your multichannel operations, then it’s generally their responsibility to stay updated with the functional requirements and underlying tech systems of each marketplace. Automation can help with this, but there’s no substitute for also staying close to channel communications on changes in regulations, processes and new initiatives.

6. Picking the right channels to focus on

Effectively marketing your products across multiple channels requires a tailored approach for each platform, while trying to maintain consistency in brand image and values. This can be heavy on time and requires expertise to scale the business across each channel.

Being present on multiple channels gives you resilience, but each channel must provide you with a return and acceptable profitability for your effort – otherwise, it can dilute your focus and should to be discontinued. Make sure you can easily analyse sales and margin performance for each channel, as well as with a consolidated view.

The eCommerce scaling problem is, in many cases, about the ‘back end’ not being able to cope with the processes and demands of selling across multiple online channels. This puts a lid on being able to grow the business profitably. Removing inefficient, inaccurate and duplicative processes characterised by heavy and frequent manual interventions is only cost-effective through software automation.

To discuss your ambitions to profitably scale your business, get in touch here.