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Published: Apr 19, 2020 by Samson Haileyesus In Small Business News 0

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The unprecedented impact of the COVID-19 pandemic continues to threaten

supply chains and how businesses operate, all of which add to the COVID-19
impact on ecommerce. Across industries, storefronts have been shuttered and
sales have declined. Businesses have tried to weather the storm by pursuing
models that could help them mitigate possible damages by the coronavirus
pandemic.

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COVID-19 Impact on Ecommerce

However, due to social distancing and stay home policies, the COVID-19 impact on
ecommerce was an initial spike in sales. With foot traffic significantly declining sales
spiked as consumers started going online to buy and have goods delivered to their
homes.

According to Digital Commerce 360,

360 between March 22 and April 4 online sales
saw a 52% increase compared with the same time last year. Web-only retailers also
report this ad
saw growth. Businesses in the U.S. and Canada saw a 30% growth in revenues
compared to the same time last year. This was in part due to shoppers stocking up
on essentials, groceries and protective gear fearing the worst.

But that too did not last. Because ultimately online retailers rely on the same global
supply chain.  According to Digital Commerce 360,360 47% of retailers expect some
downside in revenue due to the COVID-19 impact on ecommerce as inventories get
depleted. A further 58% of retailers fear the virus will impact consumer confidence
prompting people to step back from making purchases.

Incentive to Buy

With offices closed, events canceled and consumers spending afternoons at home,
the incentive to go and buy is proving elusive. This, in addition to the workforce,
had shrunk in a wake of offices and businesses being forced to retrench.

The initial boost in online sales had also come with challenges. Particularly in
regards to trying to resell returned merchandise and finding workers to help
process those returned items. This has caused pressures on retailers to keep up
with inventories along with managing staff in the wake of mandatory stay at
home orders.

Disruptions Forcing Retailers to Adapt

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Shutterstock the provider

MARKETING of stock photography,
MANAGEMENT footage and music
TECHNOLOGY had to slowADVICE
FINANCE RESOURCES
down its approval rates for submissions. This as more and more states and cities
implement isolation and quarantine measures, including shelter-in-place orders.

The company recently slowed down the approval rate of those uploading images
for sale on the site. And also the rate at which sellers can upload their images. It
has also limited the volume of content contributors can submit weekly due to a
reduction in review capacity. According to the new arrangement, contributors can
submit up to 500 images and 100 videos in a 7-day period.

The disruption of the supply chain is also affecting orders and deliveries according
to Digital Commerce 360. Some 44% of retailers expect product delays due to the
coronavirus and an additional 40% expect inventory shortages. One in three
retailers believes it’s too early to say how the coronavirus will affect them
regarding financial expectations. Some have already started re-forecasting their
revenues amid the uncertainty. Others too are taking a new look at their business
model. They are focusing on prioritizing their efforts on badly needed products.

Changes in the Marketplace

Despite the challenges, Amazon and other retailers are stepping up their delivery
services by prioritizing shipments of household essentials, medical supplies and
other priority items. Amazon has announced that it has temporality stopped
shipment for low priority products and have done that with their retail vendors.
Thus, negatively impacting Amazon’s retail vendors who do not service household
essentials, medical supplies and other priority items. Retail vendors do however
have the option to sell their products on the platform and fulfilling the shipments
themselves.

Amazon has also announced it is opening 100,000 new full- and part-time positions
in its fulfillment centers across the US to mitigate any manpower shortages.

Ebay has rolled out a stimulus for online retailers using its platform. It has
decided to allow eligible eBay sellers to defer fees for 30 days. Additionally, it has
removed listing fees until June 30. New sellers opening an eBay store will not be
subject to selling fees for three months. According to eBay, this will help them
establish their online presence while brick-and-mortar locations stay closed due to
movement restrictions.

In addition, it has temporarily extended its returns timelines and adjusted its
Money-Back Guarantee policy to help return items during COVID-19. Now eBay
gives up to 21 business days from when a return is accepted or a return shipping
label is provided to you to send items back. Once tracking shows the return of the
item, the seller has five business days to inspect the item and issue a refund.

The challenge in dealing with COVID-19 stems from uncertainty and a lack of clarity.
How long will the pandemic last. And how long can businesses operate under the
new norms. These questions continue to test the resolve of businesses.

Image: Depositphotos.com

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