Are you running an e-commerce business? If so, then it’s important that you don’t end up overspending in your company. This is particularly important right now because we are currently heading for a massive recession. So, it’s important that every type of company is on the right track, reducing wastage and keeping their solution efficient. You might think that it’s easy to keep the costs of an e-commerce business low, but some clients do struggle here, particularly in the first couple of years. So, what are the right ways to reduce costs with an e-commerce business?
By Team Savant
Image: Morning Brew on Unsplash
At the same time, you need to make sure that reducing your costs doesn’t ultimately lead to a reduction in the service that you can deliver to your customers and clients. Hence, we’ll explore some of the best ways to keep your costs low in your company.
Hire An Accountant
A lot of business owners think that hiring an accountant is going to add to their costs. If you are running a small e-commerce company, you might be looking to save money however possible. But an accountant will save you in the long term. With an accountant, you can check your costs and savings in real-time. You will be able to tell you if there are areas of your business model where wastage can be significantly reduced. This could be in the logistics side of your business model or even marketing. Accountants will also be useful at key points throughout the year. For instance, with an accountant, tax management which can be a massive headache for companies will soon be an absolute breeze.
You might think that an accountant isn’t a service that will fit into your business model. It’s true to say that hiring a full-time accountant isn’t going to be an affordable option for most businesses. But you can think about outsourcing instead. Through outsourcing, you can get the service that you need with the price that you won’t. There are also automated solutions. The best-automated solutions will keep the costs under control and allow you to check on your accountants in real-time. So, you’ll be able to correct an issue with spending immediately.
Cost Compare Different Options
It is easy to get swept away in the chaos that is financed, without taking a step back and trying to figure out if you have the best deal. A lot of companies do this, but it’s a big mistake to make. If you want to make sure that you are getting the best price, you’re going to have to take the time to compare costs. What is so good about the deal that you are considering? If you can’t answer that, then you need to do some more research into the area.
For example, when it comes to figuring out what the best Amazon freight forwarder is, you’re not going to know unless you look around. Getting the cost for your e-commerce company right is going to largely depend on how much effort you put into working out what is going to end up being best for the business. There is no reason for you to be paying more money for something that you can get elsewhere, which is the same quality but a lower price.
Find The Value
You do need to make sure that you are providing a service that does deliver value to your customers. The real value is more difficult to achieve than most business owners think. It means that customers know that when they buy from your business they will be getting a product they true or a service that they can depend on. In fact, this should go beyond the product or service and include everything interaction you have with a customer.
If you’re wondering whether you are delivering the right level of value, then you need to make sure that you are checking in with your customers and clients. Remember, marketing to new customers will always be a more expensive option compared to keeping existing customers buying your products. So, it makes sense to focus on ensuring that your current set of customers love the service that they receive every time they buy from your business. This goes beyond the price of the product and more towards the quality in every aspect of the sales process.
Reduce the Costs In the Right Areas
Image: Katie Harp on Unsplash
As you know, there are a lot of costs that are associated with running an e-commerce business. If you have noticed that you are spending too much money, then it’s time to sit down and figure out where it is all going. Some people choose to hire an accountant for tasks like this, but if you can do it yourself then there really is no need for it to come to this. Instead, just look through your books, and find out where all the money is going. Once you’ve figured this out, then you can start to make plans to reduce costs in the areas that you’re overspending in. Or, if you simply need to make some savings, you will know where the best places to cut are.
The right areas might not be apparent at first, but you will find them. Some companies go straight to their marketing budget if they want to make cuts, or to their employee budget, but we urge caution here. Take a look at all the information before you start making any cuts. It might be detrimental if you try to cut something that works well as it is, or that needs that money to function effectively.
Always Check Reviews
Reviews are essential to helping you decide what to do and where to take your company in the future. People leave reviews for all kinds of reasons, but the main one is to tell other people what they liked or didn’t like about the service that you provided them. Negative reviews have the ability to hit your profits hard because people are not going to want to use a company that doesn’t treat their customers well, or has a reputation for not providing the high-quality solution that they are promising.
But, you are also a consumer when you have to purchase things for your business. Whether it is equipment or products, you’re going to need to work on finding the best way to get what you need. You are going to rely heavily on reviews to tell you what you need to know, the same way that everyone else does. It’s for both these reasons that you need to keep your eye on the reviews. Wasting money on a low-quality product is the last thing that anyone wants, and reading reviews will save both you and your customers the time and money here.
Don’t Bite Off More Than You Can Chew
It is possible that you want to expand your business as quickly as possible. Most e-commerce company owners have this goal because they want to make sure that they can rapidly increase their profits. But you do need to make sure that you are expanding your business the right way. It’s important that you think about how to grow while keeping the costs in line. For instance, you should be completing a wealth of market research. You need to ensure that the demand matches your plans for your business model. If the demand isn’t there then you won’t be able to make the number of sales needed to keep your business in the green.
The worst thing that can happen when you’re running a company like this is that you slip into the red. Most newer businesses will not recover once they begin to take on significant levels of debt in their business model. So, you need to be smart and always weigh up the risk when you are growing your business on the market. Currently, smaller, tighter business models will be perfectly positioned to survive the oncoming storm. You just need to make sure that you are focusing on keeping the customers that you already have happy and buying.
Investment in Professional Website Redesign
An important step for any e-commerce business's development is investing in professional redesign of your website. Your online storefront is often the first point of contact between customers and you, so making an outstanding first impression is paramount. By hiring professionals for website redesign services, you ensure your new site is aesthetically pleasing, intuitive to navigate, and optimised for search engines. Expert designers can take full advantage of modern design trends, responsive mobile designs, and effective CTAs (Call to Actions) to enhance user experience and conversion rates significantly. Don't hesitate to allocate resources toward this endeavour — it could pay dividends over time.
Outsource More Than You Would
Finally, outsourcing is a fantastic option if money is your top priority. It will cost you more to keep one full-time, salaried worker than it would outsource the task to another company. When you outsource, you are getting the benefit of experts in the field most of the time, who are efficient and know what they are doing. We’re not saying that if you hired someone to be a part of your team they wouldn’t know what to do, but it is far more likely that you receive a higher standard with an outsourced company.
The thing about outsourcing is that you only pay for what you purchase. So, you only end up paying for any tasks that the company completes for you, and not a penny more. This will save you a lot of money on employees, and you still get exactly what you are looking for.
We hope this helps you understand the best ways to manage costs with your e-commerce company.