There are over 26 million eCommerce websites. By 2026, buyers are expected to spend around $8.1 trillion on eCommerce purchases. However, despite the staggering success of the eCommerce industry overall, you’re not guaranteed to succeed — 80% of eCommerce businesses fail. The harsh truth is, running an online store is anything but simple, as it entails wearing many hats.
Consequently, eCommerce outsourcing has been booming in recent years — 48% of eCommerce businesses rely on outsourced eCommerce services even with in-house staff present.
Considering all these circumstances and the competition, hiring a professional eCommerce service provider simply makes sense.
Table of Contents
What Is eCommerce Outsourcing?
eCommerce outsourcing is the process of hiring a third-party company to handle all or part of your online sales operations. This can include anything from managing inventory and order fulfillment to creating and maintaining your website and customer service.
The most outsourced branches are:
- IT services (54%)
- Finance (44%)
- Payroll services (32%)
- Customer service (22%)
Coincidentally, in today's competitive market, many eCommerce businesses are finding these services are exactly what they need help with to stay ahead of the curve. While it may seem daunting, outsourcing eCommerce can be a very efficient and cost-effective way to run your business.
If you weren’t convinced already, some of the biggest players in the industry, like Amazon and Alibaba, also outsource.
All in all, eCommerce outsourcing is a cost-saving solution that boosts efficiency and gives you access to expert knowledge. This way, you can free up your time and resources to focus on other aspects of your business.
However, it's important to choose the right partner.If this seems too big of a bite to chew, you can rely on DesignRush to find you the best eCommerce outsourcing partner.
eCommerce Outsourcing Best Practices
If you are thinking about outsourcing your eCommerce operations, then you should consider the following tips:
1. Do Your Research & Find the Right Fit
There are a lot of fly-by-night operators out there, so you better find a company that has a good track record and is known for providing quality services. Before settling on your eCommerce outsourcing partner, you want to ensure they have experience with businesses like yours and they understand your needs.
Sometimes looking at their website and going to a meeting is not enough. Of course, they’ll try to present themselves in the best light possible and tell you exactly what you want to hear, which can be misleading.
Go online and read the reviews. If others are satisfied with the company’s services, there’s a fair chance you’ll be a good match.
2. Communicate Clearly
Once you start working with an outsourcing company, communicate openly with them.
Make sure they understand your expectations and requirements. Before anything else, have clearly defined goals.
Talk about the scope of work, your budget, and the timeline upfront to avoid any misunderstandings down the road.
Lastly, insist on hearing from them regularly. You can hold meetings and request project updates to ensure everything is going according to plan.
3. Be Prepared to Adjust
Having said that, as anyone who has ever outsourced an eCommerce project knows, there are always unforeseen challenges and obstacles. Projects often end up taking longer and costing more than originally anticipated, and this is normal.
That’s why you ought to build flexibility into your outsourcing agreement. Ensure there are provisions for delays, budget overruns, and scope creep.
Of course, you should also be willing to listen to feedback and make changes accordingly.
If your business has grown and your outsourcing partner has a lot more on their plate than when the contract initially started, rethink your budget and offer to pay more.
Why Outsource eCommerce?
Businesses outsource for different reasons. Most people decide to outsource eCommerce as it helps:
1. Save Time
In today's fast-paced world, you have to make the most of your time. One of the primary benefits of eCommerce outsourcing is just that — it can save you a great deal of time you can use to focus on other aspects of your business.
When you outsource your eCommerce needs, you don’t have to worry about managing inventory, fulfillment, customer service, or any other day-to-day tasks associated with running an online store.
You can choose from a variety of services that can save you time and hassle.
For example, many companies offer order fulfillment services, so you can be at ease knowing packaging and shipping orders are taken care of.
Others can handle customer service, so you can focus on growing your business.
Some companies design and build custom eCommerce websites, so you don't have to lift a finger.
2. Save Money
By outsourcing, you can save on the cost of hiring and training employees, and you won't have to invest in expensive inventory management software.
eCommerce outsourcing companies can provide you with everything you need to run a successful online store, including website design, order processing, customer service, and shipping. In most cases, you will only need to pay a monthly fee for these services.
Even better, many outsourced eCommerce providers offer discounts if you choose certain packages, which can further reduce your costs.
3. Get Expertise
There are a lot of moving parts in running an eCommerce store, so you have to ensure the customers have everything they need at their fingertips when browsing your products or making purchases. In addition, you need to worry about product descriptions, photos, customer service, shipping, and returns — just to name a few.
If you're trying to do everything yourself, it's easy to feel overwhelmed. That's why it makes sense to outsource eCommerce to experts.
By working with a team of experienced professionals, you can free up your time to focus on other areas of your business. Since they’re experts in their field, they can also help you stay up to date with the latest eCommerce trends.
These professionals can help you choose the right product mix for your store, optimize your website for search engines, set up effective marketing campaigns, or do anything else you might be struggling with so you don’t feel overstretched.
4. Increase Flexibility
If you're looking for a way to boost your business's sales and flexibility, outsourcing eCommerce is a great option to consider. With someone else taking care of the day-to-day operations of your eCommerce site, you'll be able to respond quickly to changes in the market or customer demand.
When you outsource your eCommerce needs, you can choose from a wide range of services and customize them to meet your specific needs. You won't have to make any compromises when it comes to running your online store.
Be it adjusting your product offerings or pricing, you’ll be able to focus on what you truly know — your product. And, since you have someone else taking care of the technicalities, you’re just a call away from adding new features or services as your business grows.
5. Reduce Risk
By entrusting eCommerce operations to specialists, businesses can reduce the risk of:
- Downtime and inefficiencies related to eCommerce infrastructure
- Technical issues and potential threats like traffic surges or payment fraud
- Increasing financial burdens associated with hiring, training, and retaining in-house professionals
- Diluting resources since businesses can focus on their core competencies
- Errors in areas such as product listing, order fulfilment, and customer service
eCommerce Outsourcing Pros & Cons
eCommerce outsourcing is not a one-size-fits-all solution. Choosing to outsource depends on the size of your business, the scope of work, your needs, and your expectations. Consider the following before making a decision:
|eCommerce Outsourcing Pros
|eCommerce Outsourcing Cons
|Enables you to focus on what you do best
|Provides reliable technical support
|Gives you access to expertise and unique resources
|Supports steady business growth
eCommerce Outsourcing: Key Takeaways
The best way to improve your eCommerce business is to take advantage of the knowledge and experience of others.
When you choose to outsource your eCommerce needs, you can enjoy the benefits of having professionals on hand to take care of all the details for you. To boost their efficiency, consider bringing an enterprise software development specialist on board, too.
From design and implementation to marketing and customer service, there’s an eCommerce expert out there willing to provide support throughout every stage of your eCommerce business operations.
What is the difference between insourcing and outsourcing eCommerce?
Insourcing and outsourcing in eCommerce refer to two distinct operational strategies. Insourcing involves managing all eCommerce activities internally within the company, leveraging in-house resources and capabilities for tasks like digital marketing, catalog management, and customer service.
On the other hand, outsourcing involves delegating these eCommerce functions to a third party or external agency specializing in that area. While insourcing offers more control and coordination, outsourcing provides access to external expertise, potentially leading to cost and time savings.
Is outsourcing good for an e-business firm?
Outsourcing can be highly beneficial for an e-business firm. By leveraging external expertise and resources, companies can streamline operations, reduce costs, and focus on core competencies.
Plus, it allows for scalability, as businesses can easily adjust the level of services based on market demands. However, it's key to effectively manage these partnerships to ensure alignment with business goals and maintain quality control.