How much should a Delicatessen or Farm Shop earn from its website?

Hider+Delishops Food Products

Ok, so you want a website. Do you know why?

Every expense you make has to do one (or more) of these three things:

  1. Attract customers
  2. Get them to buy something
  3. Get them to come back.

It is not rocket science. We are retailers: that means sales.

So let’s ask what can a website earn for you? You are going to pay for it, so what is your ROI – your Return On Investment.

Everyone thinks it’s all about Direct sales. You list your products and people buy them.

I promise you now, that is often the LEAST valuable part of a website. Margins are dodgy, volumes are low, competition is high, advertising expensive. It can work for your unique or proprietary product ranges, but not for your entire stock list.

So if you are not earning from that – where can you earn

1 Increasing buying frequency - give people more ways and reasons to buy the products they already love. This is the big one. By offering things like forward ordering for Christmas, local delivery, click and collect, you get to widen the range of opportunities for your customer to need and buy your products. You can increase the sales of your most popular products by 20% by offering them in new ways

2 Indirect sales – take commission on the sale of other people’s goods or services online. Very few retailers realise they can leverage their customer base to sell the products of friendly producers online. Hider Delishops offers this.

What can you earn?

✔ Low turnover - 4 sales a week of £33 earns you over £1,030 pounds new profit cost free each year.

✔ Mid turnover - 6 sales a week of £60 earns you over £3,744 pounds cost free each year

✔ High Turnover - 20 sales a week of £60 earns you over £9,360 pounds cost free each year

✔ Large footfall businesses – turn over £500,00, you make £75,000 cost free profit

Why does this earn you more than you own products? Because you earn commission and you don’t have to touch any product – so no investment in space, time or people. It is not just 100% GROSS margin, it is zero cost so 100% NET margin, straight to your bottom line. All on the basis of maximising the value of customers whom you have sent years building up into a loyal following.

3 Marketing – attract people to your shop by using your online shop as a shop window and promoting promotions. This is about using your online shop – the products, the prices and the promotions - to draw people into your store.

The new consumer does more research – otherwise known as checking their phone over breakfast on a Saturday morning – to decide on their comings and goings of the day. Your online space can attract a wider, more fickle, more diverse group of people by posting links to your products, prices and promotions on social media. Increase your footfall by 10%.

So let’s summarise what your website should earn for you:

Increase frequency of purchase: New ways for your existing customers to buy and use your products

Sell other people's products: earn commission on sales from other businesses to your customers

Attract people to your store more often: Use your website to advertise products, prices and promotions

Does your website earn these for you?

Posted by Charlie Turnbull, Founder on Oct 13, 2020 12:08:00 PM
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