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As part of Bdaily’s latest feature, Entrepreneurship Week, we hear from the founder and entrepreneur behind Squelch Wellies, Amanda Wooldridge, who has called for large third-party platforms to help protect small, British retail businesses as they struggle to navigate surging energy charges, the cost of living crisis and supply chain issues.
Squelch Wellies was founded in 2019 and swiftly grew during the pandemic, in-part due to the brands success in dealing with third party resellers such as Amazon and Joules, but the process hasn’t been without its challenges.
Amanda, who currently lives in Alnwick, Northumberland, commented: “I am huge fan of partnership and collaboration; selling via third-party sites has helped me to grow my business and reach new audiences in a way that simply wouldn’t have been possible through my own channels.
“But there has been a lot of learning along the way, and I want to help other small businesses to get the best out of these relationships and encourage larger platforms to make the process as fair and transparent as possible
“The best partnerships with third-party sellers is when it is exactly that, a partnership. Both sides benefit from the arrangement but sometimes small businesses can get the raw end of the deal when it comes to notice periods or commission.
“We all need to pull together to protect our small businesses, especially at the moment, they add so much flavour and creativity to the market and we need as many as possible to survive.
“I’ve been stung in the past and a less resilient business simply wouldn’t have survived the experience, it all comes down to fairness and transparency and if everyone goes into these arrangements with all of the knowledge available, it is a much more positive and profitable experience for both parties.”
There are big benefits to partnering with a third-party platform; You can increase the reach of your business massively through these channels and customers who have never shopped from you will have the opportunity to try out your products for the first time, which in the long-term can lead to repeat purchases as your brand awareness grows.
This kind of collaboration also means that while they have access to a wider product range and new ways to attract customers, you can benefit from much higher marketing and advertising budgets to get your products in front of the right people at the right time.
Before you enter into any agreements, it’s important to know the pros and cons. So, what should small retail businesses be aware of before working with a third party platform? Read on to find out more…
Notice periods
Short notice periods, such as 30 days, can be a red flag as it doesn’t really give you enough time to find a new platform, reallocate stock or adjust your projections. Speak to your partner platform about a three or even six-month notice period to give your business a buffer to re-group and plan what’s next.
Be mindful when you are ordering stock and minimise the amounts you order where possible, this means that if you are no longer using a certain platform you aren’t left with costly stock in storage.
Don’t put all your eggs in one basket
There are often no stipulations around how many third-party platforms you can work with and it’s a good idea to spread the risk as much as possible, especially when it comes to holding stock. This way if it doesn’t work out with one platform you have more than one outlet to move products, alongside your own channels.
Working with different platforms also allows you to test and learn about your markets and understand which products sell better and when. Just make sure to keep track of your stock so you have a good idea of where the opportunities lie.
Imitation is the best form of flattery
Small retail businesses are full of great ideas and fantastic products, but keep in mind that while you are getting the benefits of marketing collateral and access to a larger audience pool, the third-party platform is getting data on which products their customers love.
Unless you own the copyright to your product, be prepared for imitations to hit the market if you are selling well. You can mitigate against this by investing in your brand and story and understanding what makes your business and product special, weave this into all of your marketing and communications and your customers will understand what sets you apart.
Calculate your fees
Take time to understand the breakdown of costs including any agreements on percentages of sales, storage fees, listings and participating in extra ads and promotions. All of this will eat into your profits and can be an unwanted surprise if sales are going well.
Be mindful of how any updates to policies affect you and how fluctuations in their selling price has an impact on your bottom line.
In short, there are huge opportunities and benefits for small retail businesses to partner with third-parties, it just takes a little planning and clarity to make the relationship as smooth as possible.
By Matthew Neville, Senior Correspondent, Bdaily
