Managing an e-commerce business

In part two of her e-commerce guide, Chloë Thomas gives advice on running an e-commerce operation, touching on working space, IT systems and getting help.

Running an e-commerce business is not that different to running any sort of business. You’ve still got to understand the finances, manage the staff, deal with the overheads and facilities, and worry about the IT infrastructure. The big difference however is that you need it all on day one.

If you’re starting out as a consultant all you need is a laptop, a phone and an internet connection. You can work from the kitchen table and grow gradually. In e-commerce, from the day you launch, you will need somewhere to store the products you’re going to be selling, you will need a proper email address, and a proper website. You will need some software to help with the order processing and to take the payments. Plus you will need someone to deal with the customer queries.

On day one it might just be you, a lot of software in the cloud and a very full garage – but that’s still a lot to deal with! If all goes well you are going to be growing 0 and in e-commerce growing means you will need:

  • more people
  • more space
  • more robust (complicated) IT systems.

Sod’s law means that you will reach the tipping points at the worst possible time. The orders will suddenly take off whilst you’re on a buying trip to China, or the website hosting will finally crack on the Friday before a bank holiday weekend. That means you need to make sure you have some form of team in place ready for those tipping points, because when the moment comes you’ll barely have time to firefight, let alone find the right suppliers to help you through it all.

Who then, do you need on speed dial, ready for when the moment comes?

More people to help

It might be that you know a friend or two who would be willing to muck in when needed, and that’s great – but it’s rarely a permanent solution. That means you need to know which temp agency in the area you want to work with. They’ll be able to get you help, fast (usually within 24 hours) – but you need to know which one you want to phone.

Temps will only take you so far, and there will come a time when you want a more permanent person in your team. The rules around employing people are getting ever more complex so I strongly suggest you find an HR consultant to help you out, and don’t just go to your solicitor.

Yes, your solicitor can help you, but it’ll cost you at least double what an HR consultant will charge and they can’t sit in on meetings with you (when I had to make someone redundant, using lawyers cost me ten times what the HR consultant I met the following week quoted me).

Having a good HR consultant on the end of the phone is always useful, even if you’re just employing temps and family members.

Working space and storage space

There are two types of space you will find you need; working space and storage space. You also need to have phone numbers at your fingertips for each of these. Find out the prices of the storage solutions near you – and don’t forget to ask the local council about garage availability, not suitable for all storage needs but very cheap!

By working space I mean both office space and picking and packing space. Find yourself a commercial property surveyor, they will help you understand what you need and find it for you – this will save you a lot of time. They’ll also know how much you should be paying for the space and do all the negotiating for you – the one I used to find offices got me a rent reduction considerably greater than his fee, and saved me from having to put a personal guarantee against the agreement. A good property surveyor is worth their weight in gold.

IT systems

As an e-commerce business, everything the customer knows about you is driven by your IT systems: the website they see, the parcels they receive, the customer service care you give them. The right IT system can make your life so much easier, but the easier it makes your life the more it will all need to be integrated.

A highly-integrated IT system is much harder to put in place, and if it goes wrong it goes wrong in a big way. So finding the right suppliers and systems is crucial.

To find these key supporters you are going to need recommendations. The best way to do this is to get out from behind your desk and go and meet other business owners. I would suggest networking locally to find great suppliers nearby, and also join nationwide organisations focused on e-commerce so you can find specialist recommendations too. Oh, and a good accountant is very much worth finding too.

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