Running a manufacturing company is not a simple task. Huge competition, complexity of processes make only a few successful.

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Manufacturers often pay the most attention to developing and improving the products they offer, placing less emphasis on organizing the sales process.

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Patryk Budziński

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+48 723 395 567

To date, the sales model in manufacturing companies is accomplished by working with distributors, wholesalers or expanding local representative offices. This is a very time-consuming and costly process. Legal, logistical and operational barriers prolong the process of entering new markets. Gaining the right market position sometimes takes years and is fraught with high risk of failure. Even the most thorough market analysis and marketing research do not provide assurance that entry into a given market in the traditional way will be successful. It is also worth mentioning that the model of selling through a distribution network includes the cost of commission/margin for the distributor, which of course affects the final price of the product.

What can a manufacturing company do to minimize the risk of entering new markets or increase margins from sales?

One solution that may prove successful is to launch an online sales channel. The low barrier to entry, relatively low cost and lower risk argues for considering such a decision. Note that global corporations are already increasingly offering their customers the opportunity to purchase their products online.

 

Launching our own store is also part of a broader strategy according to which today's trade is developing. Offering products via the Internet is both an opportunity to minimize the risks associated with expansion into new markets, but above all it is an opportunity to offer customers a convenient way to place orders and make purchases from places where the availability of our products is limited.

How do you start preparing to implement a store online?

Designing and later implementing a company's e-commerce strategy is an undertaking that requires a minimum of several months. The most important issue is choosing the right external company that has experience in planning, building and promoting e-commerce sites.

It is worth noting whether the company has already performed implementations similar to ours. The implementation of an e-shop for the clothing industry, those selling electronics or just manufacturing is completely different. For the latter, it is often an additional new sales channel, which must be compatible with the existing model of reaching customers.

Here are some of the most important elements to consider when it comes to implementing a store for a manufacturing company:

  • The right choice of an online store contractor - here you should be guided primarily by the previous experience of such a company. Let's ask for examples of implementations. Let's see what their end result was.
     
  • Choosing a platform - of course, the company we choose can advise us on which e-commerce platform is best to build a store, nevertheless, it's worth seeing more about, as this very much determines the future operation of the store and possible later expansion. We write about which platform to choose to build an online store here.
     
  • Usability - is nothing more than designing the store in such a way that the buyer can very easily find the product he is looking for, quickly place an order and make payment.
     
  • Mobile online store - the mobile revolution is in full swing. Today, consumers, as well as companies, are increasingly making purchases via smartphones. Experts predict that soon 80% of online purchases will be made this way. Taking this into account, you should take care to make a perfectly working mobile version of your online store. One that presents itself correctly on all mobile devices, and in which shopping via smartphone is as easy to complete as on computers.
     
  • Logistics - a buyer who orders goods online expects delivery to take no longer than a few days, or even the next day in some industries. The universal rule of thumb is that the shorter the delivery time, the greater the certainty that the customer will be satisfied with the service. The delivery time of the goods is one of the most important factors in deciding whether the goods will be bought just from our online store.
     
  • Returns - the consumer has the right to withdraw from the contract within 14 days of delivery of the goods to him. It is his responsibility to send the appropriate statement and return the goods intact. However, as for the cost of delivering the goods to the seller, this is on the consumer's side. And here again we are dealing with a factor that can positively influence the decision to purchase from our online store. Free cost of returning goods = better incentive to buy from our online store. Therefore, it is worth recalculating whether we can offer such added value to our customers and introduce it sometimes even at the expense of increasing the price of the products.
     
  • Marketing - the most widely practiced way to reach new customers is through AdWords campaigns. These are paid advertisements that allow a company to rank highest in search results for specific keywords. It can take months to position a store on the high positions of the first page of search results. Thanks to AdWords, we can compete for customers right from the moment the ad is launched, while having total control over the advertising budget.

Applications

To the question posed, whether a manufacturing company, should launch its own store on the Internet, the answer is yes, as much as possible, and there are many advantages to this.

The three most important of these are:

  • independence from distributors,
  • Improve margins, which in the traditional sales model must be shared with an intermediary,
  • accelerate expansion into new markets without incurring the high risks and costs of developing a distribution network.

However, the fact that implementing an online store may be a cheaper and less risky way to enter new markets or optimize the cost of ditto in those where you currently operate does not mean that it is a way doomed to success. Therefore, let's not underestimate solid preparation for such a venture.

For more on what to look out for when implementing an online store in a manufacturing company, read this post on our blog.

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