THREE weeks ago, I ordered P2,000 worth of products from an online store where products sold are from various merchants in different parts of the country. In the past three weeks, deliveries were made and saw that there were several instances where the things that arrived were more than what I ordered or not the brand I asked for.
This is a challenge that entrepreneurs have when thinking of putting up a portal that will sell products from various sources and where the deliveries will have to be made by the supplier themselves.
If coordination is not made in a documented manner, it can result in errors. Customers asking to return and correct their orders would mean additional costs, as it is not the customer’s fault if wrong deliveries were made and misunderstandings occured on how an item should be delivered in terms of quantity and other concerns.
When putting up an e-commerce site, an online store owner must build a front and back-end that should be ready to scale to accommodate 10, 100 or 1,000 orders a day. Such figures are no longer impossible, as there are several local e-commerce providers already processing that volume.
Coordinate with suppliers to find out how much can they deliver to you in a month before going full blast in your marketing efforts for a product. If they are only capable of selling 50 items and you sold 100, that is half of your marketing spend that could have been used on other products.
Check your warehousing and logistics providers. Explore your options, as limiting it will not give you any cost advantage. This is especially true if the products you are selling are also carried by competitors, unless you have a contract that stipulates the warehousing and logistics provider will give the most affordable service versus available market options in exchange for exclusivity.
Study product packaging and minimum volume requirement for orders. It is okay to sell affordable products if the shipping cost is not equivalent or higher. If it is, then the store owner can impose a minimum volume on orders or amounts to make it worthwhile for the supplier.
Have a clear target on what you want to achieve and build all that is necessary to make that happen. This is true whether you are carrying a product or service.
Whether that is 1,000 orders of insurance contracts a day, 1,000 food order deliveries or 1,000 enrollees in a week. It can’t be just aspiring for a number.
Build the necessary infrastructure to support it. Execute activities and campaigns to make it happen.
Published in the Sun.Star Cebu newspaper on March 11, 2015.
