In this post we explore if automation is your friend, not foe, if you want to scale your business.
At the beginning of this year, our CEO Sandy Scott offered some tips in Tamebay on how automating your ecommerce processes can help you scale your business. The article received the princely sum of two comments. The first one complained that it was buzzword heavy, and the second claimed it was a sales pitch, even though it offered tips to improve 5 areas of your business without even having to pick up the phone to us.
Automation is really important for growth, so we’re going to have another go in this post, breaking down the terms and concepts into simple language that we’re sure will pass the plain English test with flying colours, but you be the judge of that.
When we talk about automation, we can mean physical or mechanical automation like a conveyor belt which saves us from having to move an item from A to B. We can also mean electronic or digital automation, the use of a computing device to store information and do calculations that we would otherwise have to do on paper. A spreadsheet is an example of electronic automation.
When we sell an item on Amazon, eBay or our website, we have to tell each of those places, and our own inventory system, to reduce the available items by one. We can do that manually, directly in each place where we trade, or we can build a software connector using API technology to do it automatically for us, especially if we’re selling hundreds of items an hour, or even a minute.
An API is an application programming interface, a set of instructions for how to map information from the data fields in one system to the data fields of another. Similarly, when we need to order 50 more widgets from supplier A, we can phone her and ask for 50 widgets, paperwork to follow. Or, if it’s a supplier we use a lot and they’re technology-progressive, we can automate it via API.
Alternatively, we can use a ‘feed’ which is a computer file of data containing product or order information, organised in columns and rows, perhaps saved in a comma-separated-value (CSV) file – another type of spreadsheet format. This CSV file can then be emailed from one party to another and imported into their system. Better again, we can set up a file transfer protocol (FTP is another way of transmitting information, like HTTP which a web site uses) site between the two parties and send the files over the Internet.
Automation like APIs and feeds saves time, the most precious resource we have. If we save time, we save money. As we grow, we have more products, listings, regions, orders and communications to look after, but we don’t want our costs to grow at the same rate, so we automate to make our business more profitable. This is scaling – growing our business effectively and profitably.
When you decide to sell on a second online channel, a marketplace or a web store, in addition to your first online channel, you don’t want to have to double all the work – getting your product information ready to list on that channel, marketing your products, fulfilling the orders, dealing with customer queries and so on – so you generally invest in a system that can centralise and automate that effort. Same for adding a third channel and beyond.
A couple of years ago, we started asking some of our customers how many people they saved by using a system like Volo Origin to automate their ecommerce processes for them. Their estimates varied, never less than 2 bodies, and sometimes as high as 5 or more. Two or five annual salaries saved, for the fractional cost of the technology, is massive for business viability and profitability.
The important thing here is that automation is your friend, not your foe. It’s an opportunity, not a threat. We’re not talking about automation as a way of reducing your staff numbers. People have worried about robots replacing manual jobs for decades, but the truth is automation gives you options as a business owner or line manager:
If you’re researching the areas where automation can help you, have a look at the 5 areas we touched on in the Tamebay feeds article from the beginning of the year.
Automation is key to scaling your business profitably and Tamebay has published a easy-to-digest white paper on how to scale up your ecommerce business. It builds on seller research, it’s free and it’s well worth a look. It touches on automation too. We’re pleased to be able to sponsor its publication. You can download it here.
If you want to talk to us about automation and how you can use it to scale, please get in touch. We’ll avoid the buzzwords and we’ll be sure to sell you on the concept, not the company.