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Kelly has extensive experience in English editing with a focus on localization and audio description for global markets’ content. Through this, she discovered her passion for accessible and inclusive content that spans languages and hearing or sight difficulties. Her experience and education have further developed her proofreading and research skills, which she utilizes in all her writing and editing.

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With her education in screenwriting, Kelly has been working on her first feature screenplay and aspires to write for TV one day.

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At BeProfit, our team of experienced writers and editors provides you with expert articles with insights to turn your e-commerce business into a profitable one. Professionals fact-check our content to ensure relevance and accuracy. We only source content from reputable sites and research institutions. Our content is rigorously reviewed before publication and upon considerable updates. 

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Advantages and Disadvantages of E-Commerce in 2023

The four business models making up the e-commerce industry are based upon transferring products or services directly from a vendor to a consumer with the help of modern tech and without ever having to visit a physical store or location. If you’re considering whether this business venture is a good fit for you, understanding the major benefits and drawbacks of e-commerce can help you make the right decision. 5 Advantages of E-Commerce in 2023 1. Enhanced Customer Experience The advantages of e-commerce to consumers mainly deal with user experience and convenience. Not only can customers shop whenever and wherever, but they also have more options to compare products and prices. From reviews to detailed product descriptions, customers can access a range of information. Whether it be the convenience of shopping from home, the 24/7 availability, or access to a wider range of products that simply aren’t available downtown, more and more people are preferring to shop online over traditional brick-and-mortar stores. 2. E-commerce Benefits Businesses Businesses can use conversion and tracking technologies to monitor how their customers use their websites. This can provide insight into their customers' shopping behaviors, which can then be used to personalize the shopping experience for each customer with more relevant product suggestions and personalized offers. This can boost sales and revenue by building customer loyalty and increasing customer satisfaction. Social media and multi-channel strategies, such as email marketing, offer extended reach and loyalty for businesses to approach potential customers and talk to current ones. These strategies can assist e-commerce enterprises in increasing sales by raising brand awareness. » Leveraging social media? Find out if Facebook or TikTok ads for e-commerce are best 3. Businesses Can Target a Global Audience Rather than being subject to the limitations of a finite localized customer base, e-commerce grants budding and established online stores the ability to reach an international customer base - meaning anybody with an internet connection is now a potential customer. 4. E-commerce Benefits the Government Sector It’s not only customers and businesses that can reap rewards. Since the operation of e-commerce can minimize paperwork and make it easier to organize paper-based information, it also benefits the government sector. Increased resources and efficiency mean that delivering public services, like education and healthcare, is a more achievable outcome. 5. Fewer Overheads and More Savings No rent, no building or contents insurance, and fewer staff wages all mean that e-commerce expenses are comparatively less and the stores are cheaper to establish and maintain. These savings are great for business owners and also a tremendous bonus for customers as the savings are reflected in product and service costs. 4 Disadvantages of E-Commerce in 2023 1. No Brick-and-Mortar Store to Browse Through One of the major disadvantages of digital business and online shopping is that customers can not see the product in real life. For example, if you’re selling clothing and accessories, customers won’t be able to try on an item first to make sure it fits. If they're unhappy with the product, it could lead to refunds, returns, and bad reviews. 2. Shipping Times Unlike in-person shopping, customers don’t get the product immediately. In fact, shipping times are one of the worst technical disadvantages of e-commerce to consumers. While same-day shipping is offered as an option by some online businesses, customers typically receive their orders locally within 2-7 days, while international shoppers have to wait between 2-4 weeks. Additionally, shipping costs can be a costly drawback. It's up to you to balance customer satisfaction with business expenses and decide what percentage, if any, of the shipping costs will be covered by you. » Learn how to improve your e-commerce order fulfillment process 3. No Sales During a Site Crash Sure, you’ll have the advantage of being open round the clock, but one of the more technical disadvantages of e-commerce includes site crashes. If your site unexpectedly goes down, you won’t be able to process any sales. Worse yet, potential customers won’t even be able to browse your product range and wish list items for later purchase. 4. Inflation concerns With 26% of small business owners stating inflation is their biggest concern in operating their businesses, it's unsurprising that post-pandemic inflation has led to consumers becoming more careful with their spending. E-commerce businesses can adjust to account for inflation by adjusting their product offerings. For example, they may choose to focus on selling lower-priced items or offering more sales and discounts to attract price-sensitive consumers. However, these adjustments can negatively impact e-commerce businesses, as they may lead to decreased profit margins and increased competition with other businesses. » Discover the best conversion rate metrics for e-commerce startups Is E-Commerce Worth It Despite the Disadvantages? The seemingly limitless potential of the e-commerce space—from multi-channel approaches to site personalization—offers room for e-commerce businesses to have wider reach and innovative options to promote their brand. With metric tracking through platforms like BeProfit, e-commerce businesses can also continually monitor, manage and improve their strategies to help improve sales and revenue. Plus, considering that there are ways you can reduce the impact of the disadvantages, such as improving your system security to limit the possibility of a site crash or improving your digital marketing strategies, the advantages of e-business can make it a lucrative venture for an entrepreneur with limited funding.

Cost leadership strategy to maximize profit

Effective Cost Leadership Strategies (With Examples)

Business strategy is a critical but subtle aspect of a company's business. The strategy defines a company's long-term goals and should be based on detailed research of its industry niche and the company itself. A well-developed business strategy should be stable enough to be used as a foundation for crucial decisions and should be flexible enough to adapt to emerging changes. What Is a Cost Leadership Strategy? Cost leadership is a business-level strategy that aims to establish a company or business as the lowest-cost producer in its industry. This can be accomplished by cutting costs in all areas of operations including: WagesMarketingProduct developmentBusiness operationsMaterialsTransportation This approach allows companies to establish an advantage over their competition, which often leads to increases in revenue and overall profit growth. Additionally, there is also an integrated cost leadership and differentiation strategy, which involves a company selling low-cost, unique products that you can't get elsewhere. A great example of this would be IKEA. » Optimizing your marketing? Find out how remarketing and retargeting differ Examples of the Best Cost Leadership Strategies In a variety of different industries, there are commonalities between companies that have implemented successful cost leadership strategies. With this in mind, know that you can apply the lessons learned from these businesses in order to boost your own successes. Here’s a look at the best cost leadership strategies commonly implemented: Bargaining power Securing low product and manufacturing costs with suppliers will drive down operating costs and improve your fulfillment process. To achieve this, shop around and use the competition between suppliers to your advantage. Compare competitor pricing strategies, approach separate suppliers, and use your bargaining skills to secure the lowest product prices and increase your overall profit margins.Automation Finding and rectifying inefficiencies and implementing automation and technology to increase productivity and reduce costs. Recurring tasks like data reporting, email marketing, applicant screening during hiring, and many more are all business processes that can be easily automated.Replicable products and services Offer products or services that are standardized, easy to reproduce, and simple to deliver to customers.Scale operations Increase profit through economies of scale, where more units produced means lower unit costs.Pricing Cost leaders often evolve into price leaders as well because of the low prices they can offer their customers. Pros and Cons of Cost Leadership Strategies Pros: Dominate the competition If a sustainable cost leadership strategy is achieved, a business has the potential to dominate its industry by outperforming its competition through low operating costs, low product and service prices, and high-profit margins.Boost brand reputation A well-planned cost leadership strategy allows the firm to build its reputation rapidly, which quickly creates demand for the items and services and boosts product profitability.Increase profit High-profit margins, good market reputation, and low operating costs can significantly improve business stability and boost overall success. Cons: Compromised quality of service A cost leadership strategy may force a company to cut corners and compromise quality in order to keep costs down.Risk inflexibility A company that's cost-focused has likely minimized all of the costs along the entirety of its supply chain including procurement, logistics, warehousing, and manufacturing. And this can create complications as high-efficiency companies tend to be quite inflexible by nature. » Discover how to reduce your cost of goods sold (COGS) Who Benefits the Most From Cost Leadership Business-Level Strategies? Businesses across the board all benefit from cutting operation costs. But when it comes to cost leadership business-level strategies, who benefits the most? Small businesses can benefit from cost leadership strategies in a lot of ways. It is quite easy for a small business to gain a competitive advantage through cost leadership strategies as it isn’t that difficult to change, adapt, or rework its business endeavors. Small businesses are quite flexible and can take advantage of market changes, fluctuations, and demand by trying strategies like dynamic pricing. Not to be left out, large businesses or companies can also benefit from cost leadership strategies. Cost leadership strategies work really well for firms that offer a product or service that can be standardized, is widely available, and is easy to manufacture en masse—something a large business is adept at. » Want to know trade secrets? Learn how to track revenue like the e-commerce giants Is a Cost Leadership Strategy Worth It for a Small Business? Cost leadership is a very powerful strategy, but it's not for every business. Not every business is capable of achieving the advantages of this strategy as it requires a lot of factors to be aligned. One of the most important factors is product differentiation. If you want to implement a cost leadership strategy, you need to be able to deliver a product or service that is better than the competition. That way you can provide a better quality product for a lower price and still make a profit. Tracking your revenue and profit with platforms like BeProfit's is a great way to monitor your expenses, so you can use these metrics to improve your cost leadership strategy.

Net, Gross, & Operating Profit Margins: What Is High?

Two popular metrics commonly used to gauge the success of a business are profit margin and net profit. And, while net profit is great at reflecting how much profit is generated from revenue, for some applications, it's arguable that a business's profit margin is a more valuable metric. This is because profit margin allows you to gauge how efficiently your business is running overall. Understanding these metrics—involving income, revenue, and profit—and the benchmarks of each of these can provide insight into a business's overall profitability. » Book a demo with BeProfit and learn how to calculate profit and other metrics with just one tool Difference Between Net, Gross, & Operating Profit Margins These three metrics are commonly used to analyze and measure the income of a business. All three metrics differ based on industry and business size and are typically not stagnant. To help you better understand the differences between the three margins, consider learning more about: 1. How to Calculate Net Profit Margin Net profit margin is a measure of profitability. It's calculated by determining a business's net profit as a percentage of revenue. Net Profit Margin = [(Revenue - Cost) / Revenue] x 100 For example, in e-commerce, the average net profit margin is 0.64%, whereas the average total market net profit margin is 7.77%, as reported by NYU Stern School of Business. But this can fluctuate depending on a number of factors, such as the number of sales, merchandising costs, and product prices. Another way to look at net profit margin is by using a net profit margin ratio. The net profit margin ratio is just another way to measure a company's profitability. Net Profit Margin Ratio = Net Income / Revenue This ratio tells you how much profit a company makes on each dollar of sales. Simply put, a high net profit margin ratio means that the company is making a lot of money on its sales. In contrast, a low net profit margin ratio means that the company is not making as much money on its sales. 2. How to Calculate Gross Profit Margin The gross profit margin differs from the gross profit and is expressed as a percentage. Gross profit margin is the percentage of revenue that remains after paying the cost of goods sold (COGS). The average, per NYU Stern School of Business, sits around 33% for all industries, and 42.78% for e-commerce, particularly. Gross Profit Margin = [(Revenue - COGS) / Revenue] x 100 This calculation is useful because it measures the efficiency of the business's operations, provides a benchmark for measuring other business expenses, and shows changes in gross profit margins over time. Thus, e-commerce businesses prove to be excelling at managing operational costs efficiently for a maximal gross profit margin. If you find your gross profit margin is low, however, you can look into reducing COGS, including lowering shipping costs or cutting out unnecessary expenses like excess staff or unneeded operational costs. » Need help managing expenses? Keep track of your e-commerce business expenses 3. How to Calculate Operating Profit Margin Operating profit margin (or return on sales) is the ratio of operating income to net sales. This is usually expressed as a percentage. Operating Profit Margin = (Operating Profit / Revenue) x 100 The operating profit margin ratio is used to determine how well a company can cover operating costs with revenues. In other words, how effective a company is at generating profits from its sales. This is a useful performance indicator when making comparisons to similar companies. The average total market operating profit margin is 13.52%, with the e-commerce industry at 5.85%. This can change drastically based on net sales or even streamlining operational processes to lower costs. » Find out how to calculate gross profit percentage Easily Track and Analyze Your Profits View and manage your profit trends on one dashboard. Provides a complete business and financial overview.Access to real-time data and custom reports.Link multiple platforms and shops for an aggregated view. BeProfit's app makes it simple to track and analyze your profit margins, saving you time and effort. Benefits of Knowing Your Profit Margins The ultimate goal for a business is profitability. If your sales are up, but your margins are down, you may need to take a deeper look at how you're running your business. A business with a good profit margin is able to remain afloat during tough times and capitalize on opportunities, such as seasonal marketing strategies, to help boost sales. A high-profit margin means that the company is making enough money on each sale to cover its costs and generate a positive return on investment (ROI) for continued growth. A high-profit margin also sends a positive signal to potential investors, lending credibility and stability to the business. » Learn about effective cost leadership strategies to help improve profitability Limitations of Profit Margin Calculations To calculate a profit margin, business owners need to calculate total revenue and total expenses. This can be complex. Research and development (R&D) costs are expensed in the year in which they occur, while depreciation expenses are spread out over the life of the asset. Profit margins also don't always consider changes in sales volume. If a company doubles its sales volume but keeps costs constant, the profit margin doesn't change. If a company reduces its sales but also lowers expenses and increases prices, its profit margin will increase. Calculating profit margins is not an exact science, and the outputs, while helpful, should be considered an estimation. » Discover how to perform a profitability analysis for your e-commerce store Knowing These Margins Can Help Improve Profitability Because margins can fluctuate and depend on a number of factors, knowing the benchmark values can provide an estimated guideline to assess your business. Ultimately, a good profit margin is essential for maximizing company growth, understanding how other successful businesses in your industry are performing, and achieving optimizing your processes. If you have low-profit margins, tracking these same metrics on all-in-one platforms, like BeProfit's, can offer useful insight for making sales strategy adjustments, operational optimizations, and improving revenue management.

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How to Calculate Cost of Goods Sold (COGS) for your Shopify Store

Like any business owner, Shopify store owners need to keep track of their revenue. One of the essential metrics used to determine a business's revenue is the cost of goods sold (COGS). To help you determine your Shopify store's COGS, we'll break down everything you need to know about this business metric, including how to track COGS with Shopify and how to include COGS in Shopify. That way, your next tax season will be a little bit more bearable. How Do We Define COGS? Simply put, COGS is the amount of money a business spends to produce a product. There are two key components of your COGS: The cost of materials to manufacture the productThe cost of the labor necessary for a business to sell each unit while ignoring indirect overheads (like marketing). COGS is deducted from a business's revenue in order to calculate sales metrics like gross margin and gross profit, meaning: The higher the cost of goods sold, the lower the revenue margins. However, some business costs will not be included in your COGS. Knowing what to include and exclude can help you calculate more accurate values. Included CostsExcluded CostsCost of laborDistribution costsMaterialsMarketingManufacturing overheadsAdministrative expenses Track Your Expenses With Ease Spend less time on expense and profit tracking by using seamless integration. Provides up-to-date reports on your business expenses.Can integrate multiple Shopify stores into one dashboard.Accessible on mobile and desktop devices for easy team collaboration in real time. BeProfit provides an easy-to-use platform to help you monitor your key metrics and calculate COGS without hassle. Shopify COGS: How to Calculate It This should be done for a specific period—whether that be for the year, quarter, or month. For Shopify store owners on the Shopify plan or higher, finding the variables that go into calculating COGS is fairly straightforward. By accessing your "Finances summary report" in your Shopify Admin, you can gather an overview of your store's finances for a certain period. But understanding COGS and how to calculate it can better inform your business strategies and better comprehend your business's performance. Using the following COGS formula and the correct variables, you can deduce your cost of goods sold: COGS = (Starting Inventory + Purchases) - Ending Inventory For clarity, here's a COGS example calculation: Let's say your beginning inventory is $10,000 at the start of the year.During a 12-month period, you spend an additional $5,000 on materials, products, and labor.At the end of the year, you calculate your ending inventory to be $8,000.That means your COGS is equal to $7,000. Finding the average cost of goods sold is the same for small businesses as for large businesses, whereas the actual values may change significantly. » Is your COGS high? Learn how to reduce your COGS Direct and Indirect Business Costs As a quick summary, direct costs are the immediate costs that go into manufacturing a good or service. In contrast, indirect costs are those general business expenses that are necessary for keeping your business operating. Knowing which type of cost each of your expenses falls under can help you calculate your COGS accurately. Here's a quick breakdown of each: Direct CostsIndirect CostsRaw materials used in productionMaintenance, utilities, and repairsConversion costsDepreciation on production machineryDirect labor costsOther factory overhead costs Importance of Knowing COGS COGS can determine whether a company has a positive or negative gross profit. Subtracting the COGS from your revenue can help determine your gross margins and gross profits. If the COGS is too high, the gross profit will be significantly impacted, making your business less economically viable in the long run. Knowing your COGS can help you assess what areas of your business you need to adjust in order to maximize profit. Importance of Keeping an Accurate Inventory Aside from the obvious reasons for keeping an accurate inventory, such as allowing potential customers to see how many products you have in stock, an accurate inventory is also vital in allowing you to calculate COGS correctly. The inventory left from the previous period acts as your starting inventory when calculating your COGS. Without an accurate estimate of inventory, your COGS will be skewed, which will ultimately impact how your business's profit is calculated. How to Make COGS Tracking as Easy as Possible Keeping on top of everything while running an e-commerce store certainly isn't easy. Thankfully, with the help of Shopify apps, you are able to perform many tasks easily, such as pricing your products and shipping your orders. With BeProfit's Profit Analysis Dashboard, specifically, you can monitor your inventory, integrate your data into one hassle-free dashboard, and track your expenses to simply calculate your COGS, revenue, and profit. » Learn how to use the COGS formula to analyze your Amazon business's profitability

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How to Track and Boost Amazon Sales Using Google Analytics

Amazon is undoubtedly a powerhouse for selling products online across continents. That's its strength. But Amazon does have a few weaknesses. One of those weaknesses is that it doesn't harness external traffic. It is so effective in harnessing internal traffic that external traffic becomes the proverbial "runt of the litter." Internal traffic covers the 310 million active customers on Amazon.External traffic is the world outside of Amazon. So, how can you improve both internal and external traffic to help improve Amazon sales? You can use Google Analytics to gain valuable metrics and insights into your sales strategies. This can help you adjust where needed to help your internal and external traffic perform optimally, resulting in increased sales and revenue. Why Is Tracking Your Amazon Sales So Important? Tracking your sales is vital for any e-commerce company, regardless of what platform you use or the industry you are in. So, it goes without saying that tracking your Amazon sales is critical to the success of your business. Did you know that almost 40% of first-time sellers lose money on Amazon? This is because they haven't calculated their true profit. Amazon FBA calculator can help with this. This and various other tools Amazon offers can help you track your sales funnel achievements. For one, the Amazon ads reporting tool measures and reports advertising campaigns, while dropshipping on Amazon can remove your logistical burden altogether. These tools are available (some for free) and can really help you understand your internal Amazon traffic and sales, so use them to your advantage. But for maximum effect, you can use Google Analytics with Amazon functionality. How to Track Amazon Sales in Google Analytics 1. Open your free Google Analytics account if you don't already have one. 2. Copy your Google Analytics tracking script. To do this, you need to go to Admin. 3. Once you have opened Admin, click on Tracking Code. Copy the script that you find under the heading Website Tracking. 4. The script you copied now needs to be pasted into your Global Site Tag section. You can do this for all the landing pages you want to track. 5. If you want to track promotions, paste the code script you copied into your thank you page scripts. 6. View your data and metrics to analyze sales and more. How Google Analytics Can Boost Your Amazon Sales Google Analytics opens your eyes to a bigger picture—the whole picture. You can calculate COGS (cost of goods sold), promote your Amazon products, and most certainly boost your sales. Here are some ways in which Google Analytics can help: Identifies the best referral sites and then aggressively pursues them: it's targeted, not just spray and pray methods.Finds keywords and uses those keywords to drive more conversions.Optimizes your content with on-site searches that work. This will help your customer get what they are looking for as fast as possible and supports the sale.Helps you understand the customer journey so that you can optimize sales. It's about tracking their habits and then gently directing them to buy your products.Gives you a look into what your customers are thinking and what their interests are. If you know what their interests are, you can give them more of what they want.Gives you a path report with timelines, so you know how long it took for your customers to convert. It shows how many interactions happened before the sale and what those interactions were. This all gives you clues to removing obstacles to sales.Tells you your customers' lifetime values. This tells you how loyal they are and how long they are expected to stay a customer. There are so many more benefits—it all depends on the products you sell and your industry. For example, Google Analytics can be integrated with Google Ads. This way you can monitor the performance of your Google Ads, adjust where needed, and create remarketing lists for more targeted advertising. You Can Have Your Cake and Eat It Too Tracking sales analytics can help you better understand the success of your business, as well as where your sales approach may need some work. Google Analytics is a great tool to help with this as it can seek and help implement conversion tactics, like keywords and referral sites, to help improve sales for your Amazon store. Additionally, by understanding customer behavior through metrics, you can make informed strategy changes to boost sales. Another all-in-one platform to help make tracking your sales metrics and profit easier is BeProfit. BeProfit can integrate all your stores into one customizable dashboard. With real-time monitoring and insights, you can adjust your sales practices to maximize conversion and profit.

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4 Best Conversion Rate Metrics for E-Commerce Startups

Online business is booming—and many want a piece of the action. E-commerce sales are expected to make up over 20% of global retail sales in 2023 and capture just under a quarter of the global retail business by 2026. But the downside to this is the immense competition that new platforms have to contend with. More customers visit e-commerce sites, but does that convert to more sales and profits? These four best conversion rate metrics for e-commerce startups can help find the answers. 1. Customer Conversion Rate From marketing to website design, hiring customer support teams, and designing sales tools, it costs a lot to keep your website running and drawing customers in. But once the customers are on the site, how many make purchases or sign up for loyalty programs? The customer conversion rate values quality over quantity by focusing on how many site visitors actually take action. This could involve clicking links to products you are promoting, signing up for loyalty rewards, or anything else you really want them to do on your site. Customer Conversion Rate =Total Number of Site Visitors / Number of Actions Completed x 100 This formula provides an essential metric for any business looking to build customer retention and increase sales and revenue. This should be analyzed regularly to ensure your customer conversion rate is high. For example, if Store A has high site traffic, but a low customer conversion rate, it implies that the money and effort that’s gone into marketing a specific action or promoting their website is most likely going to waste. » Check out how to increase your Shopify conversion rate here 2. Sales Conversion Rate As opposed to the customer conversion rate, the sales conversion rate focuses on one particular aspect—number of sales. The average e-commerce conversion rate is 1.74%. You should view the sales and marketing team in tandem to reach this conversion rate. This metric helps you determine the quality of leads produced by your marketing team and evaluate how well your sales team is doing. Sales Conversion Rate (%) = Total Sales / Number of Site Visitors x 100 For example, if Store A's site receives 60 site visitors this month, but this only converts to one sale, what is their conversion rate? Sales Conversion Rate (%) = Total Sales / Marketing Leads x 100= 1/60 x 100= 1,67% So, Store A has a sales conversion rate less than the average. One way to improve your startup's general sales conversion rate is to examine the leads that your marketing team is producing. Are they valuing quantity over quality? If yes, then you may need to re-evaluate your priorities, like looking into utilizing more effective e-commerce ads. Sales conversion rates can be checked weekly or monthly, but they shouldn’t be carried out scarcely. Without such reports, startups could bleed much-needed capital, resulting in massive losses. » Learn about your shop's conversion by calculating micro and macro conversions 3. Customer Retention Rate Anything from a bad site experience to slow customer service could lead to your e-commerce business losing customers. An important job of an e-commerce startup is to make sure customers stay loyal to your business. Analyzing this is where customer retention rate calculations come in. It measures the number of customers you’ve kept over a specified period (monthly, quarterly, yearly), which can offer you useful insight into what you’re doing right and which practices need a bit more work. Customer Retention Rate (%) = [(Total Customers - New Customers) / Number of Customers Before] x 100 Let's take Store A as an example again. Say they have 10 new customers this month, had 150 total customers last month, and now have 100 customers in total for this month. Customer Retention Rate (%) = [(Total Customers - New Customers) / Number of Customers Before] x 100= [(100 - 10) / 150] x 100= [90 / 150 ] x 100= 60% This shows that Store A was able to retain 60% of their customers. It's important to note that it's much cheaper to keep an existing customer happy than to abandon them and chase new potential customers because existing customers are more likely to buy your products and refer your site to friends and family. This will mean better potential for greater sales conversion rates. » Looking to know more? Find out benefits of customer retention analysis 4. Average Order Value Now that you know how many customers you're keeping and the rate of customers that may be completing actions, like purchases, it's useful to know how much each customer spends on your site in one go. Here's how to calculate the average order value (AOV): AOV ($) = Total Revenue Over Certain Period / Number of Orders Placed So, let's say Store A made $20,000 last month and had a total of 500 orders. AOV ($) = Total Revenue Over Certain Period / Number of Orders Placed= $20,000 / 500= $40 This means Store A's average order value for last month is $40. This value can help your budding e-commerce platform establish the groundwork for future strategies because it helps you understand the value of individual customers. An increased AOV for returning customers can naturally perform well because there are minimal to no extra costs needed to generate these purchases. If you’re spending a lot of money on marketing and receiving thousands of hits on your website every day, but none of these result in big sales, for instance, it may be time to re-evaluate your strategies. For example, your site navigation may need improvement or you may need to explore a dynamic pricing strategy. Get on the Right Conversion Rates Track With BeProfit Tracking all these conversions for your e-commerce startup may be overwhelming, from trying to understand consumer behavior to sales and marketing tactics. But it is crucial to monitor these metrics so you can find where your site's strengths and weaknesses lie. Not to worry, though, BeProfit can help with this. This way, you can focus on the data results and use them to make strategy adjustments to help improve your business' growth and number of sales. » Ready to see how BeProfit can help? Book a demo today

4 Easy-to-Use Dropshipping Apps for E-Commerce Beginners

Getting into e-commerce can be daunting, especially if you don't know where to start. E-commerce is a vast business landscape, and every ambitious entrepreneur needs to know their way around it. That’s why dropshipping apps have become an essential tool for new e-commerce businesses. Dropshipping allows you to integrate your online store and sell products without having to store or manage them yourself, which makes it a useful solution for startups with limited budgets or resources. In this article, we'll explore four dropshipping apps for e-commerce beginners to kickstart their businesses. » Find out if Wix or Shopify is better for dropshipping Benefits of Dropshipping Dropshipping has significant advantages for e-commerce businesses. The most notable of these include: Lower startup costs - You don't need to invest in large amounts of inventory upfront. This is especially helpful for entrepreneurs with limited capital and those who want to test the viability of an e-commerce idea before going all-in.Scalability opportunities - Dropshipping allows you to scale up your business easily by increasing the number of products you offer without having to order and store large amounts of inventory.Lower inventory management - You don't need to worry about managing inventory or stocking shelves, as most orders are sent directly from the supplier. This leaves you more time and resources to focus on other aspects of running your business.Broad product offerings - Dropshipping gives you access to an almost limitless range of products. You can fulfill customer orders from anywhere in the world without having to worry about shipping or stocking inventory.Flexibility - Dropshipping allows you to make changes and adjustments quickly. From testing out different product ideas to choosing a different supplier, you can make changes with ease. Wondering how to utilize dropshipping? Let's look at some easy-to-use dropshipping apps available. 1. DSers DSers is dedicated to helping dropshippers grow their AliExpress dropshipping businesses, as well as integrate with online stores such as Shopify, WooCommerce, Wix, and more. It helps e-commerce owners manage inventory, track orders, and automate product updates. Additionally, DSers streamlines the entire dropshipping process. It allows you to locate top-tier suppliers with its Supplier Optimizer feature, find and assign multiple vendors for a product with Variants Mapping, and place hundreds of AliExpress orders simultaneously with the Bulk Order feature. It also helps manage multiple stores on one dashboard and automates processes like order placement and syncing tracking information. A free plan is available with extensive useful features. For all features and more product listings, for Shopify specifically, you can upgrade to an advanced plan for $19.9 a month. » Do you use Wix? Find out more about Wix's inventory management 2. Trendsi Trendsi combines technology and fashion in a one-stop shop for all your dropshipping needs, from finding the latest trends to sourcing and managing suppliers. With Trendsi, you can quickly find hot-selling items that are trending in the market and source them from reliable suppliers without buying inventory. Trendsi selects quality U.S. brands and trusted overseas products with higher margins, packs and ships directly to customers with branded invoices, and even handles returns. You can also manage your suppliers, track orders, and optimize your product listings to attract more customers. If you're looking to save time on research and product writing, Trendsi offers support with product photos, descriptions, and measurements. There is no monthly fee, which makes it a great all-in-one easy solution for e-commerce beginners looking to set up a dropshipping store that specializes in fashion. 3. DSM / DSM Tool Having launched in 2016, DSM Tool is certainly a well-established option for dropshipping and allows automated integration with two of the world's most famous e-commerce platforms: eBay and Shopify. Some features include an innovative product search tool, listing help, and an hourly repricer, as well as bulk listing and auto restocking services. DSM Tool also offers automated fulfillment in as short as 7 to 15 days. This tool is also compatible with over 50 top dropshipping suppliers and features millions of trending products in every major category. DSM Tool also has a learning portal, DSM Tool Academy, which offers dropshipping information and guidance for those who are just starting with eBay. It also has other learning resources on various e-commerce platforms. This makes it a favorite among dropshippers. You can use it free of charge forever, and all your standard dropshipping needs are included, like integration and 25 product listings. Its basic plan, allowing up to 600 listings, starts at $24.97 a month. 4. CJ Dropshipping Established in 2000 in China, CJ Dropshipping has quickly become one of the leading global dropshipping suppliers and boasts great customer review scores, ranging from 4.8 to 5 stars across platforms like Shopify and Facebook. CJ Dropshipping can take care of your product listings, sourcing, stocking, fulfillment, quality control, and shipping. This hassle-free management service makes it an inclusive option for new e-commerce owners. With over 100,000 factories and international warehouses, no set-up or monthly fees, competitive shipping prices, and a free dedicated personal agent, CJ Dropshipping offers extensive support and reach which set it apart for new dropshippers. Dropshipping Can Handle Your Fulfillment Needs Dropshipping can be a helpful and easy-to-use way for new e-commerce businesses to manage their store. To save on costs and time as you start your e-commerce journey, these apps can help take care of all the heavy lifting—listing, sourcing, fulfillment, and even shipping. And with some options offering personalized support and learning resources, you can run your business smoothly and with confidence. So, once your dropshipping business is up and running, you may be overwhelmed by sales data. BeProfit can help with that by tracking and analyzing your data. This can help you grow your profits by implementing any necessary strategy changes. » Looking to find out more? Book a demo today

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5 Most Important Sales KPIs for Maximal Customer Retention

No business wants to lose customers. But when customers are not engaged, whether it's because your business's site is unintuitive or your marketing doesn't appeal to them, they are more likely to move on. So, understanding trends about past customers and the most engaged customers can help improve customer retention. This is where Key Performance Indicators (KPIs) are most vital. KPIs offer targets for teams to achieve, track goal progress, and provide insights that can help businesses grow. Let's explore some important sales KPIs for customer retention. » Learn how to better understand your customers 1. Customer Churn Rate The customer churn rate is the ideal metric to consider if you're looking to track how many customers are leaving versus how many stay. This should be measured for a specified period—annually, monthly, weekly, or even daily. Customer Churn Rate (%) = Number of Lost Customers / Number of Customers Before x 100 Typically, a higher customer churn rate results in low customer retention because it means you're losing customers often. But it can be a great way to assess where your business is succeeding and where it may need to alter your strategies. For example, if numerous customers left after a particular marketing campaign, you can use this to improve your strategies for future campaigns. 2. Sales Cycle Length Now, you may have many potential customers, but how many of them result in a sale? This is where understanding your business's sales cycle length can help. It measures the time it takes for prospective customers to close a deal with you. Sales Cycle Length = Number of Days To Make Sale / Number of Sales Made The goal should be to reduce the sales cycle length because if more purchases are made in shorter periods, your bottom line is impacted positively. However, business-to-business sales generally have longer cycles because they involve multiple people consulting with one another before closing a deal, as opposed to an individual customer deciding to make a purchase. Longer sales cycles could lead to lower customer retention. For example, if your target market doesn't know your company well, their hesitancy may be higher, which means the sales cycle will be longer, and a completed purchase will be less likely. 3. Average Conversion Rate A conversion rate calculates how many site visits result in desired actions (conversions), like completing a purchase or signing up for a newsletter. This should usually be measured over consistent periods of time (like, weekly or monthly). Across multiple industries, the average conversion rate is 2.5%, so anything below this could impact your customer retention and profits negatively. Average Conversion Rate (%) = Number of Conversions / Total Number of Visitors x 100 Knowing your business's average conversion rate will allow you to track the success of the various steps you’ve taken along the way. For example, if you have a high conversion rate, you can deduce that the amount of money you've put into advertising has paid off. If you have a low average conversion rate, your customer retention may be low, too. So, adjusting your strategy for conversion can help retain customers and improve your bottom line. » New to e-commerce? Check out the best conversion rate metrics 4. Customer Acquisition Cost Customer acquisition cost (CAC) refers to the approximate cost to acquire a new customer. This can include advertising and marketing campaigns' expenses, marketers' salaries, equipment, overhead costs, and more. It's important to factor in the total of all the costs that went into securing new customers. CAC = Total Costs / Total Customers Acquired Over a Certain Period CAC can get expensive. It naturally takes more money to acquire new customers than to retain them. So, by focusing your efforts on CAC more than retention, you could be losing profits. An example of how you can implement this KPI is to focus your resources on acquisition when starting your business, then direct more costs to retain the customers you've successfully acquired. » Discover how you can use email marketing to improve customer retention 5. Customer Lifetime Value When attempting to maximize your sales potential, you should measure customer lifetime value. Simply put, it’s the amount of money you estimate a customer will spend with your business or on your products over a lifetime. You can also use this to compare the performance between certain campaigns by using data from the period in which the campaigns were active. To calculate the customer lifetime value, you first need to calculate the customer value. Customer Value ($) = Average Sale Value x Average Number of Sales Using this, you can then calculate the customer lifetime value. Customer Lifetime Value ($) = Customer Value x Average Customer Lifespan Let's look at an example to contextualize. Say Shop X has an average sale value of $30 and, on average, a customer buys products three times a year for 3 years: Customer Lifetime Value ($) = Average Sale Value x Average Number of Sales= $30 x 3= $90Customer Lifetime Value ($) = Customer Value x Average Customer Lifespan= $90 x 3= $270 This statistic can give you an idea of what to expect from an average customer throughout your business relationship. A higher customer lifetime value could indicate higher customer retention, which would benefit your bottom line. A lower value can help you change strategies and, perhaps, allocate funds for bringing in more high-value customers. » Are you a Shopify user? Check out this guide to Shopify sales reports KPIs Can Help Improve Your Customer Retention Tracking these KPIs can help you better understand the trends of loyal customers and those who have moved on from your business. Utilizing these KPI metrics can also help you strategize improved methods to increase customer retention and help your business grow. This can get overwhelming quickly. But don't worry, BeProfit can help you monitor and manage these metrics. Then, using the data results, you can focus on optimizing customer experiences and strategizing improved ways to lower acquisition costs and increase customer retention.

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5 Ways to Boost Product Profitability for Your E-commerce Store

The ultimate aim of an e-commerce store is to generate a revenue stream, and this goal can be achieved in several ways. One of the most common ways is by boosting product profitability. Product profitability measures how much money a business makes in product sales after deducting all the costs associated with producing and selling those products. Analyzing product profitability allows businesses to use insight into their most and least popular products, then make decisions regarding pricing, marketing, and inventory management. Product profitability is one of the most crucial aspects of any e-commerce business as it directly impacts the bottom line. So, let's look at some simple ways to help boost the product profitability of your e-commerce store. » Are you selling on Amazon FBA? Find out how to track and calculate your profit 1. Identify Your Most Profitable Products One of the most common and effective tools is a product profitability analysis. This analysis can help highlight how well each product sells. You can use this data to see where you can cut ineffectual advertising costs, analyze whether a new product is getting expected returns, and much more. Also, it can help your business identify its top-selling products. Understanding which products are driving revenue and profits and which products are in high demand can help you make more strategic decisions about your product pricing, inventory management, marketing, and sales tactics. 2. Increase Product Prices Finding the right price point plays a major role in any business as it impacts revenue and profits. A business might set up high prices and struggle to attract customers, while a business with low product prices might face low profits and even losses. So, you should test different pricing strategies, for example, dynamic pricing, to find the optimal price point that maximizes revenue and profitability. But finding the right price point isn’t the only step. You should also communicate value to your customers since they are more likely to buy high-priced products if they view the products as high-value items. In today’s competitive market, avoiding price wars with their competition is beneficial as these often lead to low profits. Instead, the focus should be on communicating high product value to your customers. 3. Reduce Product Costs Reducing product costs can be highly beneficial for businesses. By doing this, you can increase your profit margins and invest more in essential resources. Analyzing and negotiating with suppliers is an effective way to reduce costs. By reviewing supplier contracts, you can identify areas where you can negotiate better terms or find alternate suppliers with better prices. Another effective way to reduce costs is streamlining the supply chain. This also includes minimizing shipment and fulfillment costs as all these have a high impact on the bottom line. By optimizing the supply chain, you can reduce the time and resources required to deliver the products to customers, which can help to improve profits and customer satisfaction. » Want to know more? Learn more about the most common e-commerce expenses 4. Upsell and Cross-Sell Upselling refers to the process of encouraging customers to buy a more expensive version of a product they have already purchased, while cross-selling involves customers also buying related or complementary products. Implementing these sales strategies can result in a higher average order value and better revenue from the same customer. Cross-selling can also allow you to sell more products to the same customer. Whether it's a package deal or a bundle, it can act as an attractive proposition to the customer who may not have considered purchasing the complementary product otherwise. Offering website personalization and product suggestions is a great way to upsell because, similarly, it can introduce customers to products they might have not considered buying. 5. Improve Product Listings and Descriptions Writing compelling product descriptions with highlighted benefits can be a game-changer for your online store. This allows you to communicate value to potential customers, which can help increase profitability and sales. Apart from descriptions, using high-quality images and videos can contribute to more profitability as it allows customers to visualize how the product can fit into their daily lives. Also, having detailed product specifications and features in the listing can help customers make confident purchase decisions. And adding customer reviews and product ratings can increase trust with your customers and validate your products' authenticity. Trust and authenticity can lead to improved sales, better customer retention, and higher profitability. » Find out how localizing your e-commerce website can increase profit Let BeProfit Help Boost Your Product Profitability Product profitability is vital for your business's bottom line. And there are several strategies you can try, including identifying top-selling products, analyzing customer demand, finding the right price point, reducing costs, and implementing post-purchase upselling and cross-selling strategies. That's just the start. It's important to continuously monitor and analyze product profitability to ensure you're making informed decisions and optimizing your strategies for increased profit. But all the analysis data may be overwhelming. That's where BeProfit can help. With BeProfit providing valuable insights and tools to help you track and optimize your product profitability, you can focus on trying some of these boosting strategies to help improve your business's profits and growth. » Book your demo today to see how BeProfit can help

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5 Top E-Commerce Strategies to Recover Abandoned Carts

Abandoned carts are a major drawback for e-commerce websites. According to studies, just under 70% of online carts are abandoned. Abandoned carts refer to when a customer adds an item to their online shopping cart but doesn’t complete the purchase. This can lead to critical losses in sales and revenue, low customer retention, and increased customer acquisition costs. There can be various reasons behind abandoned carts, such as unexpected extra costs, high shipping fees, technical issues, security concerns, slow websites, lengthy checkout processes, or a loss of interest. So, let's look at some ways to help recover abandoned carts. 1. Sending Cart Abandonment Recovery Emails Cart abandonment recovery emails are automated reminders that are triggered when a user abandons their cart. This email encourages them to complete their purchase with a call-to-action (CTA) button that reverts them to the product's website. These emails are most effective when two or three follow-up recovery emails are sent and can lead to a 20% conversion rate, on average. Even if the user does not complete the original purchase, these emails can help increase customer retention and revenue by providing a way for them to sign up for a newsletter or suggest product options they might prefer. » Learn about rates, recovery, and plugins for abandoned carts on WooCommerce 2. Using Remarketing Ads Remarketing ads use personalized advertising to target users who have already interacted with a business's website. These ads aim to remind the users about the business's brand and revert them to the site. This method is highly effective and has a 70% chance of a conversion. The user is more likely to complete their purchase because of the familiarity and personalization this marketing strategy adds. The click-through rate is also higher than regular ads because they are often more appealing to users, offering incentives or personalized product suggestions. 3. Using Personal Outreach Personal outreach involves contacting a user who has abandoned their cart, often via a personalized email or a phone call. This is usually a one-to-one approach where a sales representative offers various incentives that encourage the consumer to complete the purchase. This approach can result in increased loyalty, repeat business, and a chance of recovering a potential customer. This strategy also helps understand why the user left their purchase incomplete, which can help you improve your business's checkout process going forward. For example, let's say a user added some products to their cart but left because of a technical issue or payment authorization problem. When one of your sales representatives reaches out and detects the user's interest in the product, they can provide expertise and guide the user through the checkout process. 4. Using Web Push Notifications A web push notification is a message that pops up on a user's device when they've left an e-commerce site and acts as a reminder of the products in their cart. This strategy can be highly effective in terms of reach, personalization, and cost-effectiveness. For example, you could offer an incentive, like free shipping, as a way to entice the user back to their cart, as well as directly address them by name for added personalization. These notifications rely on timing and using urgency in push notifications could help recover abandoned carts. For example, a timed incentive like 20% off on the item in the user's cart for the next two hours. By securing more recovered carts, as well as targeting users on your site in a timely manner, you can help increase sales. » Looking to improve profits? Find out how web personalization can help 5. Cart Abandonment Recovery SMS A cart abandonment recovery SMS involves sending a friendly text message to users with abandoned carts. Immediate message delivery can improve conversion because most people read 90% of their SMS messages within 3 minutes of receiving them. There are several other benefits, such as personalization, low costs, and real-time capabilities, like offering a reply option or live chat for any questions the user may have. You can also add value, like free shipping or coupons, which can encourage the user to complete their purchase. This tactic is highly effective because the information is sent through mobile, and mobile e-commerce sales account for about 41.6% of all e-commerce sales. By combining this method with others, like recovery emails, you can maximize the chances of users recovering their abandoned carts. BeProfit Can Help Recover Abandoned Carts Abandoned carts are missed revenue opportunities. When a user adds an item to their cart and doesn't complete their purchase, it shows their interest but also their hesitation. By personally reaching out to users, businesses have a high chance of recovering lost revenue, increasing sales, and understanding which site attributes are turning potential customers away. Personal outreach can also result in improved customer loyalty and future sales. But implementing these strategies is just a start. And that's where BeProfit comes in. BeProfit is an all-in-one platform to help you track your business metrics, from expenses to profits. With the metrics managed, you can then focus on refining your strategies to increase your business's growth and provide your customers with the best user experiences to reduce future abandoned carts. » Book a demo to find out how BeProfit can help