5 things to consider when setting up an online shop
If you’re a traditional retailer or wholesaler and don’t already sell online, it’s probably only a matter of time until you do. After all, it’s not easy to stay relevant in retail in 2016 without an online shop –some 77% of UK consumers now shop online, according to recent ONS data, which represents a massive 24 percentage-point increase since 2008.
It’s also never been easier for a small business to make the move into ecommerce. Thanks to the rise in open-source platforms like Magento and PrestaShop, and the option to sell through third-party marketplaces like Amazon and eBay, it’s neither costly nor technically demanding to get the basic components of an online shop in place.
However, if you actually want to succeed in the age of omnichannel retail, that’s a whole other ball game. Before you make the move into ecommerce, it’s vital you understand the full range of implications for your business – otherwise, there’s every possibility your efforts will cause more problems than they solve.
With that in mind, here are five of the things you should consider when setting up an online shop.
1. How will selling online affect our margins?
Obviously, the introduction of new fulfilment options will affect your margins, particularly if you haven’t delivered goods directly to customers before. If you would otherwise sell from a shop, you should also consider the impact of impulse purchases on your profitability. It may turn out that you need to introduce complex pricing structures, kits and bundles, and cross-selling to keep your margins at acceptable levels.
2. Which of our processes will need to change?
If you’ve been in the retail or wholesale market for a while, there’s a good chance you rely on a tried and tested set of processes and procedures that are pretty much ingrained in your business culture and mentality. In an ecommerce world, you may have to adapt or even jettison some of these processes. With an online shop on your hands, simple jobs like reconciliation, warehousing and picking can become a whole lot more complex.
3. What features do we need?
Ecommerce isn’t just about taking payment and shipping goods to a customer. We already mentioned that your online shop may require specialist functionality like complex pricing structures and bundles. Depending on your business and customer base, other desirable features from your ecommerce platform may include business portal and eprocurement tools, the ability to drop-ship, and even member-pricing.
4. Will our current systems support this?
Magento and PrestaShop are great frontend solutions, but without the right backend, your online shop could be doomed to failure. Many basic accounting and inventory management tools won’t allow for seamless integration with an ecommerce platform, meaning a whole lot of manual data entry on your part and a constant struggle to ensure prices, stock levels and product information are consistent across all channels. So, in order to really set your business up for ecommerce success, you may need to invest in a suitable backend system.
5. What should we look for in a backend system?
Many ERP solutions can be integrated with ecommerce platforms like Magento and PrestaShop. For a small but growing business, a good choice is SAP Business One – SAP’s flagship product for the SME market, and a solution that offers a high level of extensibility and an active community of third-party developers.
An equally important consideration is the integration itself. Many ERP providers will insist on writing their own code, or else delivering the software as a pre-packaged solution with their own preferred ecommerce platform. However, another option is to use a third-party integration tool, which offers the benefits of out-of-the-box code (including ease of maintenance and access to support) and ensures that ownership rests with your business, not your ERP provider.
Of course, this only scratches the surface of what to look for in a backend system for your online shop. If you’ve got five minutes to spare, why not download our free guide to ecommerce integration for SAP Business One for a more detailed overview of the process?