5 Reasons E-Commerce Could Replace Retail Stores | Sherpack

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5 Reasons E-Commerce Could Replace Brick and Mortar Retail Stores

7 min read
e-commerce button on keyboard

It’s tough to think of an industry that’s grown quite so fast and become so complex as e-commerce – just like it’s tough to think about doing business today without a presence online. But one question is perennial: Just how does e-commerce stack against the brick-and-mortar approach? How viable is brick-and-mortar without e-commerce, and will e-commerce replace today’s brick-and-mortar stores?

As 2021’s first-quarter growth continues, it’s looking increasingly likely that e-commerce will take a significant amount of market share from brick-and-mortar this year, accelerating a trend that has grown for some time. Check out these top reasons why e-commerce is set to win more ground, and how your business can enable it.

1. In Many Ways, We’re Too Far to Go Back

Let’s talk about 2020. The e-commerce and remote work trends that happened throughout the year, primarily related to the pandemic, were largely predicted to happen in the 2020s – just more slowly. But outside conditions forced a lot of these changes to happen all at once, which is why we saw a lot of news about businesses “pivoting” to e-commerce or putting more focus on their online sales.

And it worked! Despite the new difficulties with shipping delays, many businesses made this transition to full reliance on online sales successfully. That genie cannot be easily put back into the bottle: Companies won’t be re-restructuring as much to return to brick-and-mortar in the same way, and they won’t be giving up on the efficiencies and cost savings that e-commerce offers. Online sales also allow for newfound features like contactless delivery and similar options that have become important in today’s world.

In other words, it was the right place and the right time for e-commerce to gain ground. While it happened fast, the changes made in 2020 are here to stay, and in many cases that means brick-and-mortars are replaced.

2. The E-Commerce Virtual Experience is Improving Quickly

One of the classic defenses of a physical storefront is that it allows a business to have a presence in the real world where customers can come to personally inspect, smell, and touch products before making a buying decision. That’s still a good point, but online stores have been constantly evolving to address issues, like this, and in-person visits simply aren’t as necessary as they were before.

An excellent example of this is in the fashion and apparel industries. New techniques like 3D images that can be rotated and zoomed at will, or augmented reality options that allow clients to more effectively match clothes to their size make shopping online a far easier, more trustworthy experience than in the past. That means less reliance on brick-and-mortar and customers who are more willing to keep shopping online. Platforms like Obsess are even helping businesses to set up entire virtual stores that can be explored like a traditional brick-and-mortar store layout where users can inspect specific products they find. You can’t actually get the smells or the touch on your skin, but it’s the next best thing.

Let’s not forget about the backend value: E-commerce makes it much easier to gather data about customers and buyer behavior for CRM and helpful analysis, something that brick-and-mortar can struggle to provide to data-hungry brands.

3. Space Continues to Be a Key Cost Factor for Business Growth

For a purely e-commerce store, physical needs are simple. Offices are needed for management, accounting, and marketing. Some storage is needed for inventory, although much of this can be offloaded to a reliable third-party fulfillment center if necessary. There’s no need to pay for extra display space, a storefront, or a backspace for restocking.

Businesses looking to save money (and there are a whole lot of those this year) find this arrangement an attractive one. If their sales numbers look profitable enough for the online store, there’s a clear avenue to move away from brick-and-mortar altogether (or at least downsize) to help cut costs as the business grows. This is a situation many businesses that operate both physical and e-commerce stores are finding themselves in, and it could be a cause for a significant decrease in brick-and-mortar stores in the coming couple of years.

4. Logistics are Helping E-Commerce to Reach More People More Easily

Brick-and-mortar is all about location, location, location. With an ecommerce store, your location is everywhere with a dependable internet connection, and your shipping options are limited only by regional storage and what sort of long-distance shipping options that you are willing to offer.

This is a key consideration for smaller businesses that are working on expanding and want a dependable, cost-effective strategy. Planning for regional warehousing is an attractive option compared to the exponentially more complex option of opening a new storefront. With consumers growing more and more willing to shop online from their mobile devices and computers, there’s also less danger of losing a potential audience.

The only real caveat to this strategy is that it doesn’t work for all industries, but in those where online-based expansion is possible this is a popular approach. Also, when it comes to foreign sales, most businesses must rely entirely on e-commerce to get business, so this is a go-to option for tapping overseas markets.

5. E-Commerce Availability is What Today’s Buyers Want

There’s a reason worldwide e-retail sales revenue is expected to grow to 6.54 trillion dollars by 2022 – and you’ve probably taken advantage of one of the biggest reasons yourself: An ecommerce store is never unavailable. As long as the servers up, the store is open, 24 hours a day, every day, no time off for holidays (which are great times to offer special discounts).

This is a big bonus for companies turning to online stores as a way to ensure revenue levels, and propellant when it comes to ditching brick-and-mortar for an e-commerce alternative. It’s another facet that many consumers also grew used to in the chaos of 2020.

Enabling More E-Commerce for Your Business

With e-commerce come new shipping needs and a new strategy for shipping fees, guarantees, and packaging. Third-party fulfillment centers like Sherpack work with businesses to fill those needs and make effective online stores a reality. From working out the right bundling and packaging plans to finding ways to offer competitive shipping fees, Sherpack can help your company grow exactly as intended. Contact us today to learn more, and we will connect you with a dedicated consultant who can help answer your questions.