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Te latest ONS Retail Sales figures don’t paint a pretty picture. Retail sales volumes fell by 1.6 per cent in August 2022, continuing a downward spiral since summer 2021. Online sales which had been more robust, took a hit in August - down 2.6 per cent - as consumers returned to stores.
BY ENDA BRESLIN, GM EUROPE, SHIPBOB
Te figures show while the pie is smaller, online retail sales are making up a larger slice. Just over a quarter of sales are conducted online now, compared to under a fifth pre-pandemic, but as we enter the final quarter of the year there are some tough times ahead.
Te storm clouds are gathering on the horizon and they are coming in fast as consumer confidence is plummeting in the face of soaring inflation and rising energy bills, and there will inevitably be some tough months for retailers coming.
With costs of acquiring new customers spiking, we are arriving at a perfect storm for retailers of falling consumer spending, coupled with increased marketing and shipping costs. In these moments, retailers need to look at every area of their business for efficiency savings.
STREAMLINING OPERATIONS One of the biggest challenges for direct commerce businesses is fulfilment. Te choices facing them are to handle logistics internally or outsource fulfilment to a third-party logistics (3PL) company.
Although 3PL and internal fulfilment have some overlap, outsourcing to a 3PL offers more flexibility and gives you peace of mind, while handling things yourself lets you have more control over the process. Tere is no one right way to proceed as it will depend on your unique needs and what you’re willing to take on.
Before you make a decision, there are many pros and cons to weigh, questions to ask, and costs to calculate and compare, as this turning point will affect scalability and the need to invest in headcount, infrastructure, and time to learn the ins and outs of running a large scale fulfilment operation.
ADVANTAGES OF IN-HOUSE FULFILMENT Completing order fulfilment in-house gives you ultimate control over how your items are stored, picked, packed, and shipped to customers.
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homeofdirectcommerce.com | Direct Commerce
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