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BizReport : Ecommerce archives : March 28, 2014

How using the wrong scale causes customer dissatisfaction

Customer satisfaction is a growing concern for many retailers in the online space. While online and mobile shops are helping many bring in more revenue dollars, incorrect scalability practices are also harming some retailers.

by Kristina Knight

What is the easiest way to improve customer satisfaction? Provide quality merchandise at a low cost and ship quickly. The problem? For many retailers, improperly scaling their business and forecasting how much product they will need.

"It is important to take into account any promotions [retailers are] planning to offer and how that will impact demand. Based on that information, they can plan for growth and scalability, including determining equipment needs, machine automation and the technical and systemic support," said Maria Haggerty, CEO, Dotcom Distribution.

Especially for young retailers, it's easy to underestimate the investments needed to be made in advance to scale business. The key to maintaining a great relationship with your customers is the ability to maintain service levels when the growth in demand hits. If you are in a reactive mode, playing catch up and providing slower service, your reputation can suffer very quickly - particularly if your customers are highly engaged in social media.

"It is critical to anticipate and to maintain "excess" capacity so you are ready BEFORE the increased demand occurs. This means looking at warehouse space, packing stations and equipment to process more orders. When a spike in demand occurs, that extra space or equipment is a much more worthy investment. In many cases, a major benefit of outsourcing fulfillment to a third-party logistics provider (3PL) is that the company generally already has the infrastructure in place to handle that growth," said Haggerty.

Image via Shutterstock

Tags: Dotcom Distribution, ecommerce, ecommerce tips, ecommerce trends

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