Kenny Tsang, managing director of PingPong Payments
In recent months, online marketplaces have moved into the fast lane. Where high streets once dominated daily shopping trends, the lockdown restrictions have proven how vital it is to maintain a healthy and agile online presence.
With the threat of a U.S. economic slowdown looming, and Forrester predicting that global retail sales in 2020 will decline by an average of 9.6% (a $2.1 trillion loss), the seller landscape is likely to become more competitive as businesses look to recoup these losses and rebuild. Sourcing the right products, working with quality suppliers, and implementing operational efficiencies will become even higher priorities to sustain growth.
Ecommerce sales are looking like strong alternatives to traditional storefronts, and online marketplaces are increasingly being recognized as an avenue to reboot business growth. Many professional sellers are becoming savvy and realizing the benefits of leveraging platforms such as Amazon, eBay and Rakuten Ichiba to access a vast and ever-growing new market. Both Amazon and Shopify have continued to see marked development during the pandemic, with Amazon Q1 revenue jumping 26.0% to $75.5 billion. These numbers likely to see a continued upward trajectory as businesses look to expand their online selling profiles.
The benefits of the online market are huge: continued growth, overhead savings, and convenience, to name a few. However, as online marketplaces grow, it is becoming more difficult to remain unique in an increasingly saturated market. The end-customer sees hundreds of online experiences and it can be difficult for sellers to stand out from the crowd.
Three things keep sellers ahead of their competition—quality, price, and consistency. Sourcing top-quality products for a reasonable price and building out a strong supplier network are each critical to ecommerce businesses achieving their commercial goals and expanding into fresh markets with confidence. Global sourcing keeps costs down for both the seller and the end-customer, but it can also provide an increased variety of products. Product popularity is vulnerable to change and is continually evolving—what was popular before the pandemic will not be popular now and will not be popular in the future. Sellers need to be mindful of these changes and stay current with customer demand. But how?
Events like the Canton Fair represent an opportunity for online sellers to upgrade their supply chains and stay up to date on new product developments and capabilities—all in one place. This June, the Canton Fair is headed online for the first time in its 63-year history, meaning that it is now easier than ever for sellers to maximize the benefits without the cost of time or travel. It enables sellers to compare products and technology easily, make new connections, discover new suppliers, and as a result, they can optimize their supply chain.
Creating a strong and seamless infrastructure around supplier networks will be vital to ensuring consistent service and product line. When supply chains become disrupted, it causes significant problems and delays, and sends end-customers to the nearest competitor—long delivery times and stock shortages don’t make for loyal customers. Prioritizing agility in supplier networks and implementing smart inventory strategies, will enable sellers to pivot their product lines to align them with evolving demand, maximize overseas expansion, and ensure consistent levels of the right stock.
But the search for and qualifying of products and suppliers is only the first step in global sourcing. Expanding supply chains overseas is great and exciting; it catapults businesses into the prime position for growth. At the same time, it throws up some hurdles. The main one is how sellers manage their overseas relationships and get everyone paid on time and in the right currency. In some cases, this can discourage sellers from replacing outdated supplier relationships, resulting in negative knock-on effects to their bottom lines.
U.S. sellers are going to have to start implementing change, making sure they have a stable and efficient payments transaction process to increase profitability and deal with these sourcing alterations. Putting the right system in place—one that allows sellers to pay their suppliers on time and in the most convenient currency—will help curb global supply chain disruption. It also will add to sellers’ confidence in daily operations, and maintain a continuous flow of sales worldwide.
With 36 million Americans currently unemployed, online marketplaces will be a lifeline for many U.S. businesses, helping to maintain sales and even increase profitability throughout this pandemic and beyond. The ability to source globally will expand this opportunity and allow sellers to adapt their supply chains to suit evolving customer needs.
PingPong Payments provides financial services aimed at enabling and improving cross border ecommerce.
Favorite