How SMEs can benefit from online spending
Consumer habits have changed a lot in the last few years. Chances are you have made at least one online purchase recently. Buying online has become normal because of all the advantages it offers, from convenience, fast delivery, cheaper prices to the fact that it offers infinitely more choice, as it possible to buy from virtually anywhere on the planet.
Besides that, the trust of consumers has increased within the last years and online shopping is now considered to be safe, with convenient delivery and return services.
Decline of the retail industry
The rise of online shopping has caused many businesses in the retail sector to fail. Retailers are the last step in the supply chain and need to sell at higher prices in order to deliver a profit, as they need to play their own suppliers. Therefore, online competitors and new services such as Amazon for Business pose a threat to wholesales and manufacturers that are still reliant on their retailers for sales.
The House of Commons Briefing Document (27 December 2017) shows that the SME represents 5.7million businesses, (over 99.9% of all business in the UK), accounts for 60% of all employment and 52% of turnover.
Wholesalers and manufacturers are proactively looking for new ways to access this huge SME market, as whilst these are smaller businesses with low levels of spend, the potential prize is still huge if it can be accessed in a cost-effective manner. As important, online purchasing has already delivered a cost-effective distribution capability for the domestic market – which can easily be leveraged for the commercial sector.
The benefit to SMEs
SME businesses have traditionally been limited in the pricing they can achieve, usually subjected to agreements with suppliers. Thanks to technology, SMEs now have the possibility of acquiring an ever-increasing range of products and services at lower prices.
Compleat now delivers direct access to the wholesalers and manufactures cloud through the cloud “Punch Out” purchasing automation solution, delivering between 10% - 20% savings to customers irrespective of their size. And for larger organisations, the savings can be of up to 57% - representing over £100k per annum and a 10 x ROI on the cost of purchasing automation.