Expanding your eCommerce business goes as smoothly as a fresh jar of Skippy – in an ideal situation.
In reality, many challenges are associated with scaling up your eCommerce business, including not having enough resources to sustain your company’s rapid growth.
To help better prepare your company for scaling, you must know the common obstacles involved.
5 Common Challenges Scaling eCommerce Businesses
Start with these five common challenges you’re bound to face when scaling your eCommerce business.
1. Maintaining cash flow
Contrary to common thought, one of the biggest challenges in scaling an eCommerce business isn’t always a lack of demand. Instead, it’s often a lack of resources and capital to meet demand with enough supply, inventory, and products to sell.
You would need to obtain ample inventory in advance before seeing revenue, which can present working capital challenges.
As an eCommerce seller, getting sufficient capital can be even more challenging when your business grows 10%, 20%, and 30% monthly. Without the necessary funds, you would likely be unable to keep up, causing your business to take a huge hit.
An excellent approach is to adopt a long-term and sustainable funding solution, which can help you maintain cash flow when you need it most to support your efforts to scale.
8fig, an eCommerce growth platform, is one such example. Its solution is designed to help eCommerce sellers map out their supply chain (and its cash flow) based on projections of how it will look in 6, 12, 18, or 24 months, enabling merchants to plan their budgets accordingly.
8fig then provides capital injections in incremental stages according to each business’ custom Growth Plan to support cash flow and optimize growth.
A steady funding solution will help better prepare your eCommerce business for the cash flow obstacles involved in scaling.
2. Staying on top of inventory
Maintaining your inventory can be challenging enough during regular operations, but it can be even more taxing when scaling your eCommerce business.
After all, as your company expands, you’ll need to keep up with more orders. If you constantly run out of stock or shipping takes too long, you’re bound to face order fulfillment delays and thereby lose customers.
Plus, having too much stock can be a big problem if you’re trying to scale down your eCommerce business. You’ll lose money, which impacts your cash flow.
An excellent solution is leveraging reliable inventory management systems to accommodate rising market demands.
Inventory management platforms can help you stay on top of your stock, help manage your current inventory, plan for incoming orders, and alert you when it’s time to order more.
Use inventory management software to view your current stock in real-time, making it easier to track the status of each product across offices and warehouses.
For example, the cloud-based solution Trunk lets you list and manage products across multiple sales channels seamlessly. It allows you to link listings with SKUs automatically, eliminating duplicate entries and streamlining workflows.
The solution also lets you configure settings to display your updated listings and track your inventory levels in one place.
With the right inventory management solution, you can spend less time and resources managing your inventory while ensuring your business is well-stocked, giving you more control and greater support in focusing your efforts on scaling.
3. Finding reliable suppliers
One of the biggest challenges in successfully scaling your eCommerce business is finding reliable suppliers to work with.
After all, a crucial part of successful sales operations hinges on your suppliers’ ability to provide quality items and deliver them on time.
If your suppliers don’t deliver on schedule, your operations will likely be delayed, seriously impacting your cash flow, customer satisfaction, and profits.
The key is finding suppliers that can support and amplify your efforts to scale.
Use eCommerce platforms that let you find and connect with suppliers seamlessly.
For instance, supplier management platform Graphite Connect offers a centralized, secure solution to streamline and simplify your procurement process—from vetting and onboarding to risk management.
Buyers and suppliers can upload documents and contracts in one place for easy management and access.
Suppliers can fill out one questionnaire they can share with buyers across Graphite Connect’s network. You won’t need your compliance and procurement teams to email every supplier to get the necessary details.
The platform automatically validates essential supplier commercial data such as OFAC and TIN checking, speeding up the onboarding process. You’ll reduce risk, time, and friction in vetting and onboarding your suppliers.
Finding reliable suppliers is a key factor in scaling your eCommerce business.
4. Streamlining order fulfillment
Maintaining efficient order fulfillment influences many core aspects of your operations.
If you can’t fulfill your orders seamlessly, your sales will likely suffer and, in turn, hinder your efforts to scale your business.
For example, shipping delays, poor inventory management, warehousing issues, and miscommunications can create bottlenecks in your fulfillment process.
An excellent solution is to streamline your order fulfillment process by working with a reliable third-party logistics (3PL) company.
For instance, Whitebox offers all-in-one logistics services that handle the picking, packing, and shipping for you and allow you to customize and scale your order fulfillment.
The platform can also apply shipping labels, optimize product descriptions, and offer professional product photography, warehousing, inspection, and quality assurance.
You’ll get the same quality service for every order regardless of how quickly your eCommerce business scales up.
Whitebox also integrates easily with popular eCommerce platforms such as Shopify, Amazon, WooCommerce, Walmart, and BigCommerce.
A seamless order fulfillment process can translate to efficient operations and high customer satisfaction, equipping your business to scale and grow.
5. Managing rapid demands for customer care
Another critical aspect of scaling has good customer service.
The more customers you have, the more you’ll need quality customer service.
The challenge is ensuring consistent, high-quality, and prompt customer service when you have more customers than your business is used to handling.
If your eCommerce business can’t keep up with the growing need for customer care, it could ruin your buyers’ experience with your company, causing you to lose customers and sales.
An effective strategy is using eCommerce customer service software with robust features to simplify and streamline your client care service delivery.
Consider using customer service platforms such as Help Scout if you have multiple sales channels. It can aggregate customer care requests from your email, web chat, and social media pages. It centralizes and simplifies managing your customer service processes.
Help Scout can integrate with your eCommerce platform and easily support add-ons for new channels.
Help Scout’s robust automation features also let you automate repetitive customer service tasks by setting up workflows.
With automation, you can streamline critical aspects of your customer service process, enabling you to accommodate growing demands for customer care so you can focus more of your efforts on scaling.
Overcome Common Roadblocks To Scaling Your Business
While scaling your eCommerce business is no walk in the park, you can succeed better when you understand the common challenges and how to handle them.
Study your business and analyze the external factors that can potentially keep you from scaling effectively.
Plan, strategize, and seek reliable platforms to help you address the challenges of scaling to better position your eCommerce business for growth and success.
Keen to learn more? See our search for articles on how to keep your eCommerce business secure.