Along with virtually everything, eCommerce storage costs are on the rise. Whilst eCommerce stores continue to be more profitable than brick-and-mortar stores, eCommerce storage costs can stack up if you don’t handle them with care. As an eCommerce entrepreneur, you’ll undoubtedly be looking to cut back on every cost you can.
For many online businesses, eCommerce storage costs have been rattled throughout the pandemic. From supply chain shocks to wavering consumer sentiments, the world of eCommerce has become increasingly unpredictable. That’s why keeping your eCommerce storage costs under control is critical for any eCommerce entrepreneur.
We’re going to break down some of the best ways you can save money on your eCommerce storage costs.
Reduce Product Returns
Keeping your product in your customer’s hands is one of the best ways you can cut back on eCommerce storage costs. Not only will you have to absorb the postage costs, the unexpected need to store your product again can send small shockwaves through your storage systems.
There are a few obvious ways to reduce returns in order to keep your eCommerce storage costs down. Your website must be up-to-date with accurate and accessible information about your product, from your FAQ’s to your product descriptions and photos. If you ensure that your customer knows exactly what they are buying, they are far less likely to return a product.
A counter-intuitive way to reduce returns and therefore save on your eCommerce storage costs is to increase your return window. This means that people are less likely to return in a hurry, giving them a longer time-frame to change their mind.
Minimise Product Packaging
One surefire way to reduce eCommerce storage costs is to ensure that your packaging is as space-efficient as possible. When your product’s packaging takes up more space than is needed, that will affect your bottom-line eCommerce storage costs.
This will come with other unexpected benefits. The modern consumer is increasingly environmentally-conscious and wants less packaging with their products. If you’re worried about the safety of your products, you can add extra bubble-wrap or protective materials at the point of shipping.
Negotiate with Storage Suppliers
This is one of the more obvious ways to reduce your eCommerce storage costs. Yet actually managing to negotiate a lower eCommerce storage cost with your storage supplier can be tricky. You’ll be surprised at how many storage suppliers will offer lower rates if you offer to increase the length of your contract.
Similarly, recommending their services to colleagues or friends can also win you a tidy reduction on your eCommerce storage costs.
Operate with a ‘Just-in-Time’ Methodology
The ‘just-in-time’ methodology is a key part of a wider ‘lean’ methodology. Born in the production lines of the Toyota factories, the ‘Just-in-time’ approach means that your goods only arrive when they need to be shipped. In true Japanese style, the sophistication of the ‘Just-in-time’ methodology lies in its simplicity.
The ‘just-in-time’ philosophy regards the time a product spends in the warehouse as a form of ‘waste’. By rigorously managing your stock levels and sales, you can cut back dramatically on your eCommerce storage costs.
By adopting a ‘just-in-time’ philosophy, you can slowly weed out sources of waste and inefficiency in your eCommerce operation. If you start adopting the ‘just-in-time’ mentality today, your eCommerce storage costs will be dramatically reduced in the long-run.
Don’t Pay for Storage on Old Items
This one may sound like a no-brainer, because it is. But you’d be shocked at how many ecommerce entrepreneurs pay for stock that they haven’t managed to sell. If you build a habit of keeping hold of unsold items, your eCommerce storage costs will continue to eat into your bottom line.
What’s more, there are plenty of creative ways you can shift old stock. Consider giving it away as part of a promotion in order to win more customers. Consider running an aggressive sale campaign. You could even consider converting old stock directly into cash.
Whatever you do, don’t increase your eCommerce storage costs by holding onto unsold stock.
Use Technology to Predict Seasonal Sales
In order to cut back on your eCommerce storage costs, you should consider roping in technology. Today, there is a ubiquity of warehouse monitoring IOT applications that can crunch your past sales data, and create a robust algorithm that can effectively predict future sales patterns.
Whilst installing and implementing such a system may seem expensive at first, it may end up saving thousands in eCommerce storage costs in the long run.
Are you an eCommerce business owner looking to scale up your business? The team here at fulfilrr have knowledge and expertise across a diverse range of sectors within eCommerce fulfilment. Get in touch today.
