Due to the retail industry’s rapid digital revolution and an exponential rise in demand brought on by the worldwide pandemic, the eCommerce Business sector has boomed in recent years. As a result, more money than ever before passes via internet shops in almost every imaginable industry.

Global retail eCommerce sales are expected to reach $4.9 trillion in 2021 and climb by 50% over the following four years, reaching an astounding worth of $7.4 trillion by 2025, according to survey. It’s reasonable to argue that the future of the eCommerce industry is promising.

What is eCommerce Business?

While this expansion may seem like great news for all business owners, it’s important to remember that developing an eCommerce site entails risk. Scaling may frequently cause more issues than it’s worth, from financial problems to micromanagement errors. This is especially true if you don’t know how to safeguard your business throughout continuous expansion.

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The Secret Risks of Growing Your Business

Scaling is fundamentally an indication that a business is moving in the correct path. The opposite side’s grass isn’t always greener, though. When you ramp up operations, new problems may arise as your to-do list grows and the stakes rise.

For instance, you’ll eventually need to hire employees to split the task. Naturally, this changes the dynamics of the situation. To get the most out of their efforts, the business owner will need to rely on an altogether new set of abilities. In that vein, let’s examine five of the most typical problems expanding eCommerce firms face, followed by advice on how to solve them.

#1. Demand Forecasting

Although it might be difficult to grasp, predicting future demand for your eCommerce business is a crucial part of expanding it successfully. This is true because historical data is the main source of information utilised in predicting.
It can be challenging to predict future revenues and how they could change when you scale back operations and enter new areas. However, inaccurate forecasting can result in a wide range of problems, including: Erratic inventory, Supplier ties are deteriorating, cost increases for shipment due to expediting and Inadequate cash flow management.

#2. Obtaining Long-Term Lines of Credit

Scaling frequently calls for a financial cash. Many business owners make the mistake of overburdening themselves by not thoroughly analysing their financing choices, regardless of whether you need additional money to buy inventory, acquire an automation technology, support marketing expenditures, or even recruit employees.

There are many options, but it’s vital to remember that each way of generating money has pros and drawbacks of its own. Furthermore, even if both businesses operate in the eCommerce industry, what works for one business model would not always work for another.

For instance, equity investors (such as angel and venture capitalists) are very advantageous since they bring to the table important experience and networking contacts. However, this form of financing is dilutive, so you will have to give up a portion of your company’s equity (which could become a high cost if your scaling efforts are successful).

Bank loans and other conventional lines of credit, on the other hand, do not call for you to give up equity.
Although bank loans normally have low interest rates, getting one might be difficult since a good credit score is needed. Additionally, if you default on the loan, many banks usually want collateral, which may make bank loans unaffordable for the majority of eCommerce firms.

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#3. Overseeing New Supply Chains and Inventory

Management of the supply chain and inventory is essential to eCommerce operations. Maintaining connections with supply chain providers while controlling inventory will get more difficult as your output rises. For instance, if your present supplier is unable to satisfy your increased demand, you may need to discover new ones or invest in more warehouse space to store your inventory.

Scaling an eCommerce business sometimes entails selling goods on other platforms like Etsy, Amazon, eBay, and Alibaba. When you just use manual inventory management, expanding your eCommerce business is almost difficult and will quickly become impractical due to challenges with order fulfilment, shipping, and logistics.

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#4. Keeping Clients

The Harvard Business Review estimates that it costs five to twenty-five times more to get a new client than it does to keep an existing one. Despite this widely acknowledged truth, many eCommerce firms face difficulties in client retention as they grow.
This is due to the fact that maintaining great customer service operations as your business grows is notoriously challenging.

To put this in perspective, a SEMRush survey revealed that 14% of customers left a business because it didn’t know how to handle their concerns, and that customer retention is ranked as the most difficult task for retail firms by 61% of those polled. It should come as no surprise that one of the most important challenges that rising eCommerce shops must face is preserving or increasing CLV (customer lifetime value).

#5. Maintaining the same management structure when growth takes place

Using business methods like dropshipping, private labelling, white labelling, and on-demand production, solopreneurs manage a large number of eCommerce shops. However, if demand rises and more orders come in, the workload may eventually become too much for one person to handle.

Consider an eCommerce business owner who lacks the knowledge and expertise necessary to successfully manage and assign jobs. When they hire new employees in that situation, they may unintentionally create production bottlenecks. On the other side, if your business already has employees, you will probably need to change your management structure as you grow, which might hinder productivity and produce a commotion.

How to Solve Scaling Problems in eCommerce

Fortunately, there are some positive aspects of expanding your eCommerce business. Your store can function like a well-oiled machine even while you raise your productivity with a few thoughtful adjustments and a healthy dose of strategic planning. Let’s now take a look at five suggestions for safeguarding and getting your business ready for growth.

#1. Use Predictive Analytics to Predict Upcoming Demand

Forecasting market demand, anticipating customer behaviour, enabling dynamic pricing, and tailoring product offers are all made easier by predictive analytics. Links between various client data variables, including as purchase history, demographics, social media sentiment, online behaviour data, etc., are identified in order to do this. Therefore, in order to start using demand forecasting, you must first collect quantitative and qualitative data, such as monthly sales averages, underlying patterns, and seasonal trends.

You may create a map of what is likely to happen in the upcoming weeks, months, and years by comprehending what has already happened and contrasting it with what is occurring right now. You can either reduce operations or change your product offerings to better meet the market conditions if the trends you see seem to be against your present business strategy. As a result, forecasting frequently serves as a risk-mitigation tool that enables you to better manage the inputs into your business and its outputs.

#2. Select the Proper Funding Source

A useful option is revenue-based financing, in which companies obtain money based on expected revenue. Companies get a cash revenue in return for a portion of their future sales (between 5 and 25 percent) until the loan is fully repaid. The drawback is that it will take a while to pay off the debt, which would cause significant cash flow problems if growth slows and scaling fails.

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For business entrepreneurs who do not want to give up stock in their firms, ecommerce finance platforms like 8fig provide a fresh alternative to traditional financing. Based on supply chain estimates, which validate each seller’s development trajectory using supply chain analytics, these platforms provide eCommerce enterprises needs-based finance.

Each plan is therefore customised to your particular situation and comes with a flexible remittance schedule, preventing you from being overloaded with payments and protecting your cash flow. To choose which funding source is best for your business, you must weigh all of your possibilities. In any case, you must avoid the error of acquiring financing on unfavourable terms out of a desperate need to expand your business.

#3. Implement Customer Retention Techniques

When was mentioned, one of the first things to suffer as an eCommerce shop expands is client retention, particularly as additional channels are opened. Fortunately, there are several methods available that can help you raise client lifetime value and enhance retention rates. Here are a handful of the most successful, according to a Campaign Monitor article:

  1. Personalization may be used to enhance marketing initiatives.
  2. Use a client referral programme.
  3. Create email marketing programmes.
  4. Introduce loyalty programmes for customers
  5. Prioritize client satisfaction and experience.
  6. Maintaining consumer relationships on social media

One of the best strategies for increasing profitability, increasing brand awareness, and developing devoted brand supporters is customer retention. These strategies will put your business in terrific shape as it enters a prolonged era of development.

#4. Automate the management of inventory

You must use inventory management software to automate your inventory operations since manual management does not allow for scalability. These solutions customise your retail automation with pre-built conditions, simplify operations, and save time.

You can manage your inventory, keep adequate stock levels, sync inventory tracking across all channels, compile real-time inventory data, and gain insight with the help of inventory management software like Orderhive. All of this can be applied to grow your eCommerce business, increase sales, and take advantage of opportunities. Best of all, since you won’t need to rely on manually updated spreadsheets, you’ll be able to concentrate on other crucial tasks while knowing that inventory is taken care of, greatly lowering the likelihood of human mistake.

#5. Create an efficient and effective structure for your eCommerce business

The moment has come to expand your online shop, and in order to do so, you must establish a productive team structure. Your situation and personal preferences will determine the structure you use. However, as your team expands, you will inevitably need to create autonomous departments in charge of different operational issues, such as:

  1. Consumer assistance
  2. marketing and sales
  3. Business evaluation
  4. People Resources
  5. product creation

It would also be a good idea to brush up on the soft skills necessary for efficient management, such as delegation, leadership, communication, and time management.


Owners of businesses now confront greater demand than ever due to the rising eCommerce business. The natural next step for many business entrepreneurs is to grow operations in order to fulfil this demand and increase overall revenue. However, increasing too rapidly or without a solid plan may lead to many eCommerce shops failing as competition intensifies and consumer expectations continue to soar.

As a result, growing your eCommerce business requires a strong foundation, wise business objectives, and the dedication of time and effort to realise them. Implementing new software solutions that help automate procedures like inventory management, demand forecasting, and customer assistance will also need a large financial commitment.

Above all, keep in mind to carefully weigh your alternatives and avoid taking on more than you can handle. Keep your goal in mind, assemble a skilled staff around you, and concentrate on upholding connections with clients.
You will be well on your way to success in the upcoming months and years if you can do all of this.
Good fortune!