Alex Ogilvie is Managing Director of marketplace management business Seller Dynamics. Seller Dynamics delivers listing, repricing, stock management and fulfilment services for marketplace sellers across multiple Amazon, eBay, Rakuten, Flubit, Fnac and other exciting sales channels. Alex’ business career saw its first major success within automated banking software development where the delivery of mission critical systems was a prerequisite. That same reliability ethos has been applied to Seller Dynamics making it the ideal choice for small, ambitious and large retailers alike.
It’s never easy to raise capital for a business and post the financial crises & post the UK vote to leave the EU it doesn’t look like it’s going to get any easier. It’s particularly hard for start-ups and probably a major frustration for new retailers in particular.
Convincing a bank of your business case will be difficult and if they are convinced, they are likely to still look for some form of personal security from the directors before lending. Property is the normal go to item for most banks – and that can be a difficult asset to risk, especially if it is the matrimonial home. A modest line of credit, ideally in the form of an overdraft is perhaps the most likely positive outcome to go for, but expect that overdraft to be secured in some way. The days of unsecured overdrafts are a distant memory.
Convincing a supplier to give you a decent line of credit will be challenging in your early days, they’ll look for a trading history and at best they’ll keep you on a very short lead. More likely is that they’ll expect payment in advance initially until they are sure they can deal with you with minimum risk.
So what’s a new start, cash strapped, online retailer to do? Well there are options, Bitbond’s Peer2Peer lending is one avenue that is worth investigating. Unlike conventional lenders the credit checks that it carries out are about your online trading with the likes of Amazon, that moves things in a different direction for the online retailer.
Other cash flow help comes from pay as you go type services to help you sell your goods – you’ll need a listing, repricing, fulfilment and stock management service if you are ambitious and want to really make your Amazon and eBay sales fly. At Seller Dynamics we charge for our marketplace management service based on the sales you make in the month. There is no capex to find to buy our system. We simply charge a modest percentage, so just like Amazon and eBay we work on a success basis. That keeps costs manageable for the start up and transparent for everyone. And we also offer phone support to help our clients navigate the complex world of marketplaces, that’s particularly helpful at the start.
Marketplaces for new start retailers make great sense – there is no need to build or promote a standalone website with no guarantee of return. Instead pay the subscriptions to say Amazon and start listing. If your items are already in their catalogue you can be selling with no risk in just days. To begin with both Amazon and eBay will restrict how fast you can sell – but if you are sensible you’ll start out cautiously as well. Extending your international reach is pretty straightforward – simply start listing on the other Amazon or eBay sites when you have built up a little bit of momentum in your local territory.
Make sure that you concentrate on the quality of your service, that’s delivery and customer satisfaction, if you do that your reputation will grow, your sales will go up and in turn your suppliers will see you as a good customer. If you understand the quality levels Amazon and eBay both expect you’ll do much better and your business will flourish.
Getting started is tricky – but have a look at the options, there is help out there.