Introduction
In recent years, the world has seen some dramatic economic and cultural changes. Information can now be accessed almost instantly on any conceivable subject using the Internet. This has lead to a change in the way the consumer makes purchase decisions - there is now a medium on which to compare products from dozens of vendors at the touch of a button, which is a very valuable tool for the customer.
Online trading is an essential platform for any seller wanting to remain credible and relevant in the 21st century. After the banking crash of 2008/09, the credit culture slowed down. We discovered we had been living in a pool of cheap money that had effectively dried up. For the retailer, this meant earnings previously from borrowers declined rapidly and profits fell and even made several household names bankrupt.
The supply chain hasn't stopped, but everyone has felt the pinch in their personal wealth since the economy has taken a serious turn for the worst. From rising import costs because of the weak pound, to employment longevity concerns - these factors have altered our culture of buying goods from the first place we encounter or loyalty to a local outlet to one of shopping around for the best price. Loyalty is not an option if the price doesn't meet our budget. Much of the population is Internet savvy now, and as the children of today move into adulthood the Internet will only continue to grow. This is true of online selling - despite the economic disasters of the past year online sales are increasing. As the consumer needs to save money, they will use the Internet more and more to get the best deals from online retailers.
Some business leaders not embracing the power of the Internet to grow their business may be reluctant because they are worried about it devaluing their products or having to reduce margins in a price dominated market. However, running costs are inherently reduced when compared to running a bricks-and-mortar store. A traditional outlet requires more staffing, security, prime location and the rates that go with it, energy costs are higher and so on.
An eCommerce website can complement your existing business in many ways, in terms of attracting local people to your store and gaining new business from further afield. Adding turnover to your business to help your business to grow or at a minimum compensate for any decline as a result of the downturn is a key part of starting or reinventing an online sales venture. Online trading can help with margin too; reducing costs by negotiating with suppliers on the back of Internet pricing and more quantity of stock normally discounts your cost price also. Some suppliers are already geared for the Internet phenomenon and will send direct to site.
An online business can also be a standalone venture in its own right. Many of the biggest retailers such as Amazon and Play for example are an online only business. LRG Software was formed with individuals who have experience in not just IT but retail and online retail. The organisation was formed to pass on the benefit of the combined IT and retail knowledge in a single solution.
Mike Parker
Co-founder of LRG Software Ltd