Top 13 Money Saving E-commerce Merchant Tips
Clever business owners, like famous billionaires, know how to spend their money wisely. Would you pay $168 million for something you fancied on eBay? Russian billionaire Roman Abramovitch did when he clicked the “Buy” button for a luxury 405-foot-long gigayacht that’s the most expensive item sold on eBay—so far. The billionaire was savvy enough not to make the mistake of transferring his pounds into dollars through his bank. Abramovitch knew well enough to use his currency company to save paying high transfer fees. He’d also sidestepped getting a poor exchange rate, which would be a sizeable financial error when you consider losing 2% on a figure like $168 million.
If you’re selling online, you’re also probably purchasing your products on the internet, so it’s important you know the secrets of buying online, especially if you’re paying with PayPal to source your stock. The best way to raise your revenues is by keeping your prices competitive, which means cutting costs. Take advantage of these easy ways to save money running your e-Commerce enterprise.
The bigger the purchases, the more currency counts
1. International purchases on PayPal come with a fee for making a currency conversion. PayPal charges 2.5% of the purchase and credit cards routinely add on their 3% foreign transaction fee. That’s just the half of the fee that’s actually being charged because the hidden fee is found in the poor exchange rate with both. Find out exactly what their exchange rate is with this simple test: Log into your PayPal account, and select a “test” payment to see how they calculate the exchange. Compare that rate to the one that a currency company offers and you’ll see the difference, especially with large amounts.
2. If you’re using a credit card to make overseas purchases for your business, switch to one that doesn’t charge fees when you buy items sold overseas. An even smarter way to save money on large purchases is by making an international money transfer with a currency company that caters to eSellers. A currency specialist offers you three advantages: First they give you an exchange rate that’s much better than your bank or credit card can. Second, they won’t tack on a fee and lastly, their exceptional service includes providing you with strategies to save more money on your overseas purchases.
3. A merchant payments hub like ZooPay helps your business process international payments and gives you your own IBAN merchant account in your business name, not a third-party. You save time and money with their built-in treasury system that protects you from fraud and reduces your chargeback incidents. They also offer you currency services that minimise your market risks.
Online sellers need currency specialists
4. When you’re purchasing your stock, you’re searching the globe for the very best bargains, so it’s a pity to lose 3% of your potential profit margin in a single stroke. You also risk losing more when you get paid back into a local currency because the exchange rates may not be in your favour. Given the volatility in the currency market, the safest way to purchase is by using an E-Commerce currency specialist who teams up with your businesses.
5. Your own international IBAN account gives you the freedom of borderless banking. Save money by having the power to collect revenue in different currencies without having to open local bank accounts. You’ll save yourself from having to pay the expensive conversion fees that are usually hidden in the exchange rate.
6. Use a forward contract to hedge your currency exposure when you frequently transfer to a particular currency. Let’s say you need to exchange pounds for euros to pay your French supplier each month. You can lock in a favourable rate today and make your transfers at that rate for a year in advance. Also, set up a schedule of regular payments to your supplier at that rate. This makes it easy to budget expenses and pay your suppliers on time. Use the time you’ve saved, to focus on trimming other business expenses.
Your edge on international delivery
7. As an E-commerce business, you’re competing with Amazon’s lightning fast delivery service. It’s hard to beat prices and deliver your products quickly, so seek ways to save money on your delivery service wherever you can. A courier comparison service like Rapid Parcel could help you find a trustworthy delivery company with very competitive fees. Also, consider collaborating with a local brick-and-mortar shop so your customers can click and collect their purchases.
8. Run by a British family in Cambridgeshire, Lilpackaging supplies containers to the world’s largest online retailers and they promise lowered packing costs with increased fulfilment. They can design a variety of bespoke envelopes and boxes in sizes that save you money on shipping by giving you the snuggest, most lightweight and sturdiest shipping packages. You save on postage costs and prevent items from being damaged by using the proper boxes. Shipping is free for UK and EU delivery on orders over £25 or €50, respectively.
Keep shop simply for free!
9. If you’re just putting a toe in the water, Shopify is an easy, fairly inexpensive way to create your online store. Shopify is a hosted platform that has great technical support, with lots of free options including abandoned cart checkout recovery. This service emails customers who haven’t completed a purchase, encouraging them to come back and buy. Shopify is the leading online shop builder, but most of the over 1,400 apps you can add to your site to increase functionality come with monthly charges.
10. Open your free online store on Facebook, Tumblr or any other social media site in five minutes with Ecwid. With over 400,000 stores, it’s the most popular e-commerce app on Facebook. Ecwid’s free option limits you to only ten items which you can add to any website. Other plans include Venture, which costs €15 a month and includes allowing more items for sale with options including inventory management. The business plan is €35 a month and tools include eBay US integration. The Unlimited plan costs €99 a month for a full suite of features including point of sale and your own branded iOS and Android shopping app for mobile sales.
Anticipate many happy returns
11. Be prepared for a third of your sales to be returned by customers because return rates for e-commerce products are around 33%. Streamline your return policy by including a return shipping label. Make sure your return policy is as easy as possible for your customers without making it too costly for you by planning the reverse shipping logistics with your delivery team.
12. Being ready for the inevitable returns doesn’t mean you shouldn’t do all you can to minimise them by detailing your products as clearly as possible. When you create videos to promote items, customers get a better idea of what they’re seeing then they would with a still photograph. Promote your products and services with professional quality videos you make in-house with the services of a number of online companies. Magisto’s business service plan starts at just $10 a month and it lets you embed videos of up to 4 minutes onto your website. $40 a month buys you the power to export to Facebook Ada Manager, and use many other marketing tools. For €40 a month, Animoto supplies your business team with all the tools to make your own tutorial and marketing videos. Promoting your products by showing them being used is a good way to stand out in the marketplace, raising your sales rates, it promotes your brand while trimming your returns rate.
13. Reducing business expenses doesn’t necessitate cutting back on advertising or cutting corners on your return policy. With the right shipping and packaging strategies, you save money whether your customers pop in to pick up their purchase or order on Facebook to be delivered around the world. When you’re paying suppliers, be sure you’re not losing a share of your profits to foreign exchange transfer fees by using a currency company and a merchant payments hub. They are amongst the business services you can’t afford not to have!