One of the most popular terms we’ve been hearing about in the news lately is “inflation”.
But what is it exactly?
In short, inflation is simply the rate of increase in the price of goods and raw materials over the course of a given period.
When looking at inflation from an eCommerce perspective, it really isn’t that much different other than adding things like production, storage, fulfillment, and shipping costs to the equation.
What’s Causing this Rise in Inflation?
There are numerous factors that contribute to an increasing level of inflation however the number one overarching factor is the COVID-19 pandemic.
Disruptions in the supply chain such as cargo containers being used for nonstandard processes such as the delivery of PPE and other medical or sanitizing products have caused logistical issues for many of the world’s shipping seaports.
But it’s not just the ports.
Many truck drivers left their jobs during the pandemic for numerous reasons. Reasons include unsafe work hours, little to no benefits, and low pay.
Without the manpower to transport goods to and from seaports to their destinations, deliveries slow down and become less efficient.
The same also occurred for dock workers as well. Fewer people being available to unload docking ships leads to an increased demand for products which also means an increase in incoming ships.
You can quickly see how there starts to be more and more bottlenecks due to these issues.
What can eCommerce Businesses do?
There unfortunately isn’t a one size fits all solution for businesses.
But there are indeed positive measures that can be taken.
The businesses that are seeing an increase in their bottom line despite all of these logistical setbacks are using good old-fashioned business tactics to draw in more customers. Or making their products more appealing. Using special marketing tactics, or understanding their competitors.
For example, if business X is noticing their 5 closest competitors are raising their prices to combat inflation, business X might want to make it known to their customers that they are keeping their prices the same as before this phenomenon took place.
The commitment business X is displaying to their customers might be attractive enough for more customers to keep coming their way as opposed to other businesses raising their prices.
Perhaps running a special coupon campaign will help you become more visible and give incentives for customers to want to shop at your store more.
Maybe try a new supplier for your products. Perhaps one that is more local so as to cut down prices in shipping and decrease time to market.
With gas prices being the way they are now this could be a very real way to reduce one’s business expenses.
Perhaps adjusting the sizes in which you order your products. Buying in larger quantities to reach larger discounts from your supplier.
Inflation is something that affects everyone, not just business owners, or eCommerce businesses for that matter.
Taking this into account will allow you to be more creative with your business practices in this odd time of prices increasing everywhere.
One easy way that we help our customers reduce their bottom line, as well as their workload, is through our inventory, shipping, and order management software M.O.M..
Our software suite can be configured in ways that are custom to your business environment to fit in seamlessly with your existing process.
We’d love for you to get your hands on our incredibly easy-to-understand free product demo so that you can see it for yourself.
If you run into any questions along the way or even if you don’t feel the need to check out our demo we’d love to hear from you. Contact one of our in-house professionals today!
Thank you so much for taking the time to read more about inflation within the eCommerce community and we hope you have an amazing day!