Overcomming Logistics Challenges for Small Business

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Small business faces numerous challenges when starting up.  If you sell a product, you will experience a huge learning curve on the logistics side of your business.  As your business grows, volumes increase, complexity increases, so does the need for specialized knowledge and expertise.  However, in the beginning it can be a “chicken or the egg” scenario where you just can’t get to the next level without overcoming some basic logistics challenges.

Being able to deal with increasing complexity

If you’re a business just starting out and shipping from your home, or small unit, as demand for your product increase, so does the complexity.  Picking and packing becomes a full time job and dealing with multiple vendors and transportation providers eats up a significant amount of your time.  Implementing systems to deal with this complexity also becomes a real time consuming task.  As a small business owner, your time is the most precious thing.  Work vs. family vs. personal time puts you in a scenario where you really have to consider every minute you spend.  You have to ask yourself,  should you be doing it yourself or outsourcing it?  Outsourcing pick/pack operations can help you deal with the complexity of your growing business without having to invest time and effort in information and data systems to track it.

Matching service levels with your larger competitors

Being able to deliver next day, or internationally, is no small feat.  It requires coordination between your pick/pack operation, your vendors and your transportation providers.  This can be a daunting task for a small business owner to manage along with everything else they have to face.  By partnering with a seasoned logistics provider they can help you set up shipping zones, international deliveries, as well as, being able to negotiate more favorable freight rates which they can pass along to you.  This puts you on a level playing field with the big guys.

Keeping up with the latest data and information systems

To succeed in today’s world, business needs to know their customers and the service levels that are being provided to them.  Customers want to know “on demand” when their shipment will be delivered and when it shipped.  Plus, you as a business owner will want to track type and frequency of orders by customer, geographic region, or by promotion.  Implementing your own data systems to track all this can be complex and add another project to your already full plate.  Another advantage of outsourcing your logistics and pick/pack operation is that these solutions come standard with many fulfillment companies.  This saves you the time and aggravation of setting up your own systems.

Big Fluctuations in Demand

As a small business you rarely have the luxury of regular, steady business.  I comes in big inflows and then periods of relative slow demand.  It can be expensive to invest in systems, equipment and space to accommodate your busy periods vs. your slow periods.  Outsourcing is a great way for small business reduce their costs when experiencing surges in demand.  When outsourcing, you only pay for what you use, so peaks in demand are easily accommodated, and lulls in demand don’t come with all that uncovered overhead.

Dare Marketing has Solutions for you

If you’re considering outsourcing some or all of your fulfillment or logistics functions, it’s worth your time to give Dare Marketing a call.  Dare is an experienced fulfillment house for all your logistics needs.

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How to use Pay Per Click to Drive Traffic to your eCommerce Web Store

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If you’ve got an ecommerce store but are struggling with getting traffic and conversions, Dare Marketing has some tips for you in this easy to understand article on pay per click advertising.

What is Pay Per Click?

Pay Per Click or PPC advertising is a mechanism where you display an advertisement online and pay the advertiser every time someone clicks on your ad.

Benefits of PPC Advertising

You only pay when someone clicks!

No more wasting money.  You only pay when someone clicks.  In comparison to buying a magazine ad, you pay per view.  Many people you are paying to view your ad have little or no interest in buying.

Better Quality Leads

Generally, you find you get better quality leads with PPC rather than any other type of advertising.  If people search for “Nike Shoes” and then click on your ad, you’re pretty much guaranteed that the person wants to buy “Nike Shoes”.

Tracking and Optimization

With many forms of  advertising it’s hard to track who saw it, how many saw it, how many turned into customers and what was the ROI.  With PPC this is easy.  Most PPC advertisers give you the ability to track views, clicks, conversions and sales dollars.  Making it easy t calculate ROI and invest in the best PPC ROI campaigns.

Common Misconceptions about PPC Advertising

My competitor will click on the ads and use up my budget.

This is a very common question that PPC advertisers have.  If this was possible it would make PPC pretty much useless.  That’s why PPC advertisers have the ability to filter out unwanted clicks.  Everyone connects to the internet through an IP address.  The PPC advertiser is able to determine the IP address of the person who clicked.  If you get 10 clicks from a single IP address, most PPC advertisers will not charge you for the clicks.

What do I have to do to get top listing?

While in organic Google searches being in the top 3 is what you’re going for, in PCC it’s not really that important.  Depending on your strategy, most people want to reduce their cost per click.  It’s expensive to be listed in the top 3 and you will pay more for your bids.  As long as you’re getting traffic, why do you care whether you’re on the top or #8?  If you can get 10 clicks at $1.00 in the top 3 or 20 clicks at $0.50, being in the 8th position, what would you rather have?  Traffic at the lowest cost!

Wow, $15.00 per click is expensive!

Most pay per click is an auction.  Other advertisers bid to have their ad shown instead of yours.  I’ve seen some cost per click as high as $30!  Keep in mind it’s not the cost per click, but the ROI that’s important.  Let’s take the example of a locksmith.  Cost per click is $15.  You might think that’s outrageous, but let’s look more closely.  Let’s say out of 10 clicks the locksmith gets 1 service call.  So that’s $150 cost per sale.  People are generally not Googling for locksmiths to do research, they look for locksmiths when they are locked out of their car or home.  So a $150 investment gets you a $300 service call.  Doubling your money!  Now how many $15 clicks do you want to buy?

Best Practise in PPC Advertising

Pick longtail keywords to bid on

For example “plumber” is pretty general and could searched for a number of reasons not leading to a sale.  Now consider “24-hour plumber”.  Someone searching for “24-hour plumber” has an emergency and needs a plumber!  You would want to bid higher for these types of keywords as they will convert better.

Don’t send people to your home page

I see so many PPC advertisers sending the clicks to their home page.  This is not best practise.  If you are a shoe store selling red shoes, when someone clicks on your ad for red shoes, you want to send them to the “red shoes” category page in your ecommerce web store, not your home page.  You’ll get better conversions that way.

Marketing 101 still applies

Just because your advertising online doesn’t mean you throw out everything you know about marketing.

Your ads and landing pages still have to incorporate:
1.  Offer
2.  Call to action
3. Reply device

Track Everything

To get the most out of PPC, track everything.  Try to link the click on the ad to the sale.  You’ll be able to tell what’s working and what’s not.  This way you’ll be able to invest in the PPC advertising that has the highest ROI.  This is easily done through your ecommerce software, or simply sending the completed sale, contact form, or reply device to a “thank-you” page and tracking that.

Dare Marketing Can Help

If you’re an ecommerce retailer Dare Marketing has solutions for you from consulting to software and fulfillment services.  We have a complete suite of solutions from end to end that will help you sell more online and improve your profitability.  Contact us today for a free consultation.

How to Reduce Inventory and Increase Cash flow for your eCommerce Business

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Every business is concerned with cash flow.  Inventory is always an expensive proposition and ties up a lot of capital and cash flow.  This article explores how to manage that investment.

The 80-20 Rule

The 80-20 rule is rule of thumb that applies to many processes, it is also known as the Pareto Principal.  Pareto noticed that 80% of the wealth was controlled by 20% of the people.  Since then, this rule has been applied to many processes including inventory control.  It is typically true that 20% of your inventory items will account for 80% of your inventory cost.  We can use this assumption to our benefit by being able to tightly manage a small portion of our inventory and get the greatest return on our time invested.

The A-B-C’s of Inventory Control

  One of the simplest ways to begin to manage your inventory is to divide your inventory into “A- Items”, “B-Items” and “C-Items”.

A-Items

A items are the top 20% of items by value that you inventory.

C- Items

C-Items are the bottom 50% or so of items that account for less than 5% of inventory value.

B-Items

B items are the rest in between the top 20% and the bottom 5% of SKU’s (Stocking Units).

How to determine ABC’s

An item’s inventory value can be calculated by multiplying:
Annual Quantity Sales X item cost = Annual Inventory Value
The best way to accomplish this analysis is to put your SKU’s in a spreadsheet with the variables: Quantity, Item Cost and Annual inventory Value.  You simply multiply the columns and then use the spreadsheet’s sorting capability to sort the table on annual inventory value.
Next, add a column “Cumulative inventory cost” where you sum up the total cost of items one a time plus the items above it in the list.  When you get down to 80% of the total inventory cost, these are your A items.  Do the same process from the bottom of the list where 95-100% of the cumulative cost is.  These are your C items.  The rest are B items.

Putting the ABC’s into practice.

Now that you have categorized your inventory, you can begin to apply rules to each category.  In last month’s article we talked about Economic Order Quantity, stocking levels and safety stock.  For your A items, you may want to really reduce the safety stock and say that you’ll try to fill 80% of orders from stock for A items.  In contrast, you can stock a whole year’s worth of C items with little impact on your overall inventory value.
Spend your time managing the A items tightly and try and minimize re-orders on the C items.
This is a great strategy to get your inventory under control and start increasing your cash flow and increasing your ROI on inventory investment.

We Can Help!

Dare Marketing provides order fulfillment solutions to ecommerce retailers.  We’ve got the experience and the systems to help you take, fill and ship orders to your customers.  Plus, we can help you do it cost effectively.  For a review of your current fulfillment practices, or inquires about new ecommerce fulfilment project, please contact us.

Basic Inventory Management for Your eCommerce Fulfillment Center

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So you’ve decided to outsource your eCommerce Fulfillment for your on-line store.  Now you have to decide how much inventory to send to your fulfillment center, how much to order, when to re-order, and in general how to manage your stock levels and what the annual cost will be.

Simple Economic Order Quantity (EOQ) for your eCommerce Fulfillment Center

The first question you may ask yourself is:  how much should I order from my supplier every time I place a replenishment order?  Thankfully, there is a tried and true method for calculating this.


Where:
D = Estimated annual demand
Ct = transaction costs per order (receiving costs, order processing costs, transaction costs)
Ci = annual inventory cost per unit per year. (This includes obsolescence)
Example:
Let’s say you expect to sell 1000 widgets per year.  Inventory costs are $5 per unit per year. And transaction costs are $12 per order receipt.



=69.28 = 69 units.

When should I reorder and what Should my Reorder Point be for my eCommerce Fulfillment Center?

Reorder level for your inventory is easily calculated.
Reorder Level = average lead time demand + safety stock.
Let’s say lead time is 4 weeks, and you want to have a minimum of 25 units in stock.  Going back to the above example of selling 1000 units per year that equals (1000/52 X 4) = 77 units demand during the reorder lead time.  So, your reorder level is 77+25 = 102 units.
You should order 69 units every time your inventory falls below 102 units.

** note there are ways to calculate what your optimal safety stock should be based on average demand and the standard deviation of demand and the service level you want to achieve i.e.:  99% of orders filled from stock.  This is a little bit more complicated than the rest of the calculation in this article.  You might want to just look at your demand and pick the largest weekly order you have and keep an extra week.

How much will carrying cost be for the Inventory I store at an eCommerce fulfillment center

Let’s use what we’ve already calculated from the above two examples.  Your total annual variable cost of inventory can be calculated as follows:
Where ss = safety stock.
So, in the example we calculated 5*69/2 +12*1000/69 +5*25
=172.5 +173.9 + 125
= Your annual inventory costs for this item under this plan would be $471.40

Practical Implementation of These Calculations

Most on-line stores sell more than one item.  Doing this calculation for hundreds or thousands of items can be very time consuming and impractical in the real world.  The use of a spreadsheet where you can calculate one item per line and copy the calculation down the spreadsheet gives you an easy way to manage your inventory re-order points, order size and estimated annual cost of carrying your inventory.

Dare Marketing has solutions to help you manage your inventory and fulfill your ecommerce orders from our fulfillment center.  We’ve got over 20 years of expertise and modern systems to help manage, pick, pack and ship your orders.  Contact us!  We’re here to help.

The Value of Outsourcing Rebate Management

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The entire cycle of rebate management is a critical operation that impacts profitability and revenue generation of an organization.  Besides creating as winning promotion and rebate program, the next best way to increase your ROI on your rebate management marketing campaign is to reduce your fulfillment and administrative cost associated with the campaign. Consequently, it is crucial to employ up-to-date technologies and leverage economies of scale in rebate fulfillment.

Outsourcing or In-House Rebate Management?

Increased recognition of rebate programs as a key sales and marketing tool puts pressure on an organization to cost effectively execute a rebate program.  Rebate programs can be both expensive and administratively complex to execute in house.  That’s where outsourcing comes in.  Outsourcing rebate fulfillment processing improves the convenience and expediency of the practice and may add some data gathering that was previously unavailable. The advent of modern technology has prompted business owners to rethink their idea of rebate processing. Outsourcing of rebate management can help customers realize substantial cost savings as well as reduction in labor cost and better data collection by leveraging a rebate management specialist.

Benefits of Rebate Management Outsourcing

Multiple practices

When it comes to rebate processing, a professional rebate management company has the capacity and experience of implementing full-service rebate management processes. The process incorporates multiple levels of service delivery involving scanning, generating and issuing checks, and partial or full online processing with automated rebate optimizer software.  If done in house, this can be a tough burden on management time and process control.

Data Collection

Outsourcing enables single source database creation that allows for detailed analysis of new and existing rebate agreements, analysis of profitability, impact of rebates on different deals before negotiations, creation of elaborate rebate programs.  Access to a central database of this information will speed up the decision making process and approvals for new offers and marketing programs.

Accuracy in Pricing

Thorough processing of a rebate form requires as much as time as processing an invoice!  Outsourcing can reduce this administrative burden while collecting market prices for your competitive database.  Accurate market pricing information is important to remain competitive in the marketplace.

• Cost Reduction
• Reduction in costs of order processing
• Conversion of fixed cost operational models into variable cost
• Online access to forms for seamless collaboration
• Call center cost decrease
• Reduced program cycle cost

Significant cost optimization is possible as companies that carry out huge volumes of rebate processing already have the infrastructure and the economies of scale in processing. Depending on the specific outsourcing solution, anticipated cost reduction can vary anywhere between 20% and 40% or more as compared to processing in house.

Efficient pricing strategies combined with rebate management outsourcing helps reduce cost while improving the effectiveness of your promotions.  Both these factors lead to improved ROI.

To see how you can improve the ROI of your next rebate management project, please contact Dare Marketing where we have solutions to execute a winning rebate management program.

Have you considered a USPS Consolidator & Drop Shipping in your ecommerce supply chain?

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If your ecommerce retail store or catalogue business ships internationally, then you could save time and money by using a USPS consolidator to employ consolidation & dropshipping your orders.

How Dropshipping works

If you’re in Canada trying to ship to the US, it’s both expensive and time consuming to send your packages individually.  If you employ the use of a consolidator and dropshipper, you can send all your orders to the consolidator, who will pack and ready them for mail to the US.  They’ll send all your shipments to the USPS as one consolidated shipment.  This saves both time and cost when shipping to the US.

Key Advantages of Consolidating & Drop Shipping to USPS

 

  1. Flat Rate Shipping –makes it easy to calculate your costs and include it in your billing to your customer.
  2. On-Line Track and Trace –allows your customers to trace their own shipments, giving them piece of mind and saving you time manually tracing their shipments when they have questions.
  3. Fast Delivery Service – the USPS network is both fast and efficient getting your deliveries out to your customers quickly and economically.
  4. Ship to International Destinations – Routing through the USPS allows you to ship to international destinations other than the US.  A one-stop solution for your entire fulfillment needs will save you time.

 

Who Can Help Me with Dropshipping?

Dare Marketing has 20 Years experience in order fulfillment, logistics and parcel dropshipping to the USPS.  Contact Dare Marketing for more information.

How to Generate Sales for Your eCommerce Business Using Direct Mail

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If you have an eCommerce website where you sell products or services, this blog article is for you. This article will give you a marketing plan designed to generate more sales from your existing customer list.

So, you’ve been in business a while and have developed a good list of clients. What are you doing with this list? Many on-line businesses are so focused on generating new traffic for their websites through on-line marketing and Google Adwords, they forget about the goldmine they have in their previous customer list. Have you considered direct mail? It’s a great way to capitalize on the loyalty of your past customers to generate more sales.

According to a recent survey conducted by Target Marketing Magazine, the channel that delivered the strongest ROI for customer acquisition for B2C marketers was direct mail. Direct mail also scored highest among marketers for customer contact and retention.

Let’s say you sell shoes. You know that the average person buys 1 to 2 pairs of your shoes per year. You have to capitalize on repeat business in order to grow your business! Here’s how.

Mine your list.

Your ecommerce website supplies you with all kinds of data if you use it correctly. You can pull a direct mail list of everyone who bought shoes six months ago. You know they’re likely to purchase again. You need to be in front of them when they do.

Plan Your Offer.

You know from you data that you’ll likely sell 200 pairs of shoes, so now it the time to negotiate a mass purchase from your supplier to support your promotion. You should be able to negotiate preferred pricing which you can use to support a special offer to your client list.

Work with Your Fulfillment House

With prior planning, you can work with your fulfillment house to prep orders in advance and in bulk. This can save you in labour and fulfillment costs. Your fulfillment house can also receive orders for you from your direct mailing campaign. This will save a step in the fulfillment process.

Design and Mail

Design and mail your offer to your mailing list. A letter or card sent to previous clients is a great way to generate sales. It’s personalized and is more likely to get opened than an email.

Support Your Direct Mail Campaign with email.

Support your direct mail campaign with reminder emails. This will increase the response rate of the campaign and result in higher sales for you.

Start Again & Repeat

This is a process that can and should be done repeatedly with clients on your list. If you establish a program of repeating this cycle monthly, quarterly or semi-annually, whatever makes sense for your business. This process will help grow your on-line ecommerce business.

Tips for Driving Traffic to your eCommerce Website

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Many ecommerce websites are built in a hurry and vendors quickly get overwhelmed at adding new products, photos, product descriptions and filling orders.  If you want to sell online, you need to rank on Google for the products you’re selling.  There are some key things you need to do to make your site more search engine friendly.

 Be Consistent with Product Names on Your eCommerce Website

Be consistent with product names.  If you’re selling “Brand A Hats” then you want to make sure you set up your product pages properly and be consistent.
·         The URL for the product page should contain “Brand A Hats”.  Example http://www.mystore.com/brand-a-hats-pt333595
·         Your H1 page title should contain “Brand A Hats”  Example: Brand A Hats from  My Store.com
·         Your sub heading H2, H3, etc should contain the product name.  Example: “Product Specifications for Brand A Hats”
·         In your text, you should include “Brand A Hats” 3-4 times.
·         Make sure you include in your Photo Alt text “Brand A Hats” for all of your product images for that page.

Get your Meta Titles and Descriptions Right for Your eCommerce Website

Don’t fill in your Meta Titles and Descriptions by Default!  Sometimes people use their store name to fill in Meta Titles and Descriptions.  This is not right either.  Your store will be found on your store name, pretty much guaranteed, so don’t waste this valuable space to re-state your store name.  The meta title and meta description are what people see when your page gets found on search engines like Goolge.  Most ecommerce store software gives you the ability to customize this.  You should be writing your meta titles and descriptions to both contain your keyword and entice customers to click on your search result.  Example:
SEO Title:  Best Online Prices For Brand A Hats | Free Shipping!
SEO Description:  Great prices on Brand A Hats, thousands in stock, same day shipping and Free shipping on orders over $100.

 Employ Canonical References

Most ecommerce website software solutions are messy when serving up pages for products.  For example you may be able to find the same page under:
·         www.mystore.com/brand -a-hats
·         www.mystore.com/catagories/hats/brand-a-hats
·         www.mystore.com/ladies-hats/brand-a-hats
·         www.mystore.com/daily-specials/brand-a-hats
·         www.mystore.com/?search?prod_id3395.asp
Search engines see these as multiple copies of the same page.  They will all rank separately.  What you want is direct all the ranking to one page.  This is where canonical references come into play.  Simply add http://www.mysite.com/brand-a-hats/>  in the HTML to the product page and this will ensure that no matter how your ecommerce website serves up the page, it always tells the search engines that /brand-a-hats is the main page and where all the ranking should go.

 Make sure you don’t have more than one version of your home page.

Similar to the canonical issue, many websites by default have many versions of the home page.  You need to make sure they are all directed to a single one.  Examples are:
·         http://www.mystore.com
·         http://mystore.com
·         http://mystore.com/default.htm
·         http://mystore.com/defaul.php
·         http://mystore.com/index.htm
·         http://mystore.com/index.php
These issues have similar effect on ranking by search engines as canonical issues. The engines don’t know which is the “real” home page.  This issue can be dealt with using the canonical reference, but a better way is to employ a 301 redirect.  Your ecommerce store software should have an option to do this.  If not, you can use your .htaccess file in your root directory to employ 301 redirects.

Missing Pages and non-existent products

Ensure you don’t have any missing pages.  404 missing page errors count negatively against you in SEO.  The search engines rank user experience very high and if your site is generating a lot of missing pages and 404 errors you should clean them up.   Also, if you have old products that you no longer carry in stock, you should re-direct them to the current version.  For example if you had “brand-a-hat-ver2” and new for this year it’s being replaced by “brand-a-hat-ver3” then you should re-direct traffic to the new page.
Both of these issues can be solved by using a 301 Redirect from the missing page/old page to a current and active page.  You’re software should have an option for you to do this.  If not you can manually add the redirect in your .htaccess file.

Hire an eCommerceFulfillment Expert

Product reviews are key to driving conversions on your website.  Lot’s of positive reviews drive sales.  Getting the right products to your customers fast is critical.  Here at Dare Marketing, we understand your business and how important fulfillment is for your ecommerce website.  We offer full ecommerce fulfillment solutions.  Contact us today for a free consultation on ways we can help you improve your ecommerce fulfillment.

How Drop Shipping from Canada to the US can be Easy and Economical

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Drop Shipping from Canada to the US

Drop Shipping from Canada to the US is a Headache No More!

Many Canadian retailers and eCommerce merchants face the issue of how to supply US customers with their products from Canada.  Now, drop shipping from Canada to the US is the answer.  No longer do you have to open up or contract with a distribution warehouse in the US to service your US customers.  You know that opening a distribution or fulfillment center in the US is both costly and time consuming.  There is an alternative.  You can set up a Canadian Fulfillment center to act as a US Postal Service Depot and ship from Canada just like you were in the US, eliminating the need to set up a US fulfillment center.  Here’s how.

How to drop ship from Canada to the US

Dare Marketing offers a unique service.  They act like a US Postal Service Depot  and route the parcels through the US Postal Service for you.  This is a great option to deliver packages to your US customers.  Not only is it affordable, but easy to integrate into your ecommerce business because they offer flat rate shipping.  Also, take advantage of all the excellent tracking and tracingoffers that the US Postal Service offers.  You’re customers will get a USPS tracking number to track their shipment.  Plus, not only can you ship to the US via this method, but internationally as well.  Dare Marketing offers a similar solution through the USPS for international order fulfillment as well.

Key Advantages of Dare Marketing’s USPS Drop Shipping Solution

1.       Flat Rate Shipping 

Makes it easy to calculate your costs and include it in your billing to your customer.

2.       On-Line Track and Trace

Allows your customers to trace their own shipments, giving them piece of mind and saving you time manually tracing their shipments when they have questions.

3.       Fast Delivery Service

The USPS network is both fast and efficient getting your deliveries out to your customers quickly and economically.

4.       Ship to International Destinations

Routing through the USPS allows you to ship to international destinations other than the US.  A one-stop solution for your entire fulfillment needs will save you time.

Is Drop shipping from Canada to the US for you?

If you’re an eCommerce merchant, or maybe involved in an on-line deal site where you are shipping small packaged items under $200 per item, then this is a great solution for you to be able to supply your US customers both economically and efficiently.  Plus, the tracking options give your customers a great impression of your service levels.

How Can I get Started Drop Shipping from Canada to the US?

Dare Marketing offers a complete solution including set up for a very reasonable cost.  Contact Dare Marketing today and speak with one of their logistics experts to help you find the most cost effective and efficient way to fill orders shipping from Canada to the US, or anywhere for that matter!