Silent Business Killers
"The 3 hidden business killers that you cannot afford to ignore"
Mike Day - Founder ProStore®
3 factors that can completely derail your business (but that have somehow become normalised).
Running an online retail business can feel like an uphill struggle sometimes (we know, we’ve been there). Just staying afloat can be a challenge in itself, let alone trying to generate sustainable growth, whilst also maintaining profitability and decent margins. It’s a well publicised fact that up to 95% of all online stores fail within the first year, which equates to millions of businesses. But why is this happening, and why are success rates so low? We aim to find out…
1. The DIY Self-Build Concept
The flat-packed business model adopted by other platforms is skewed in favour of the supplier, not the business owner. These platforms are nothing but empty frameworks, and they cannot even come close to being able to run a serious online business without multiple costly bolt-on Apps. By the time most businesses have got their platform functioning as it needs to (i.e. they can actually use it), many resemble more of a Jenga tower than a robust Ecommerce solution. A classic case of flexibility leading to complexity perhaps.
2. The Hidden Cost of Ownership
Other platforms are clearly engineered to serve the financial interests of their shareholders, not the retailer. The typical DIY platform model relies on a complex ecosystem of escalating subscription tiers, transaction fees, and a commission-based app store. This creates an environment where the platform profits from every tool and transaction that the retailer needs in order to grow. Online retailers need a single, all-inclusive platform where ALL costs are transparent, and where enterprise-grade features are built-in, not expensive add-ons.
3. The Broken Support Network
The lack of help and guidance offered by other platform suppliers is a well published problem. Once businesses have signed up, owners are more or less left to fend for themselves, with zero phone support and only rudimentary Chat Bots for when things go wrong or advice is needed. You’ll be building your platform from scratch so good support is essential, unless you’re a seasoned technical expert, or you can afford to hire a whole team of them. Either way, you are almost certainly going to struggle to build a robust platform for your business without any help.
Summary
Why are these business killers? Because retailers are not IT experts. Their DIY starter kit platform does nothing, so they have to build what they need from a choice of thousands of apps. They get very little help with this, so they (understandably) end up with a rickety, home-grown timebomb of a system that is bloated with all manner of expensive apps, all of which are draining resources and potentially conflicting with one another. The sweet taste of the bargain subscription has also long gone by this stage.
Why is this a problem? Because they are then too afraid to touch anything, paralysed by the fear that one small change will cause the entire house of cards to collapse and their business to grind to a halt. If this does happen (and it usually does) then it’s entirely down to the retailer to fix, and this is normally when all of the app developers start pointing their fingers at each other and passing the buck. In the meantime, the retailer’s business flatlines.