Over the past few years, eCommerce has been snowballing in every industry. However, not until recently, the grocery segment has got a stronghold over the online business. Between 2016 and 2018, the value of the online grocery market was almost doubled. It is anticipated to triple in the next ten years.
With advancements in technology, there has been a significant rise in ordering groceries online. However, most grocery retailers cannot take advantage of this potential and convert it into a sustainable profit market. Low purchase volumes with low margins push many grocers to oversee the latency of the online grocery business.
Challenges Faced by Online Grocery Businesses
As compared to the traditional sellers and grocery, online grocery retail is a tough nut to crack. While the challenges in the online grocery business are endless, they can be easily overcome by following the right strategies.
Storage and Delivery Cost
Retailers are reluctant to charge for delivery and fulfillment costs for fear of losing customers. However, online sales do not make up for it. Online grocery delivery solutions are required to invest a massive amount of capital for making the product reach the destination in a reliable condition.
To overcome this problem, choosing a wise logistic partner is the best option. Collaborate with a budget-friendly delivery service provider who offers faster delivery management services.
Higher Operating Losses
Operations in online businesses take a huge toll on revenue. It is difficult to manage the customers, in-house processes, the margins, and the deteriorating condition of the perishable products.
In order to deal with this problem, it is best to have smart management strategies that can help you build strategic plans to run the work processes hassle-free. In the beginning, you may see a lot of imbalance between the revenue generated and the operational costs. However, it could be easily taken care of by systematic planning.
Online grocery delivery challenges include the inability of portals to manage the customer's buying desires. During peak hours, your customers may suffer from delayed deliveries. If you wish to drive your business, having a smart logistics partner will wave the magic wand.
Have a sound tracking system to help your partners find the customers' locations easily with the shortest routes. If you can get some help from a local guy who knows most of the city's nooks and corners, then there's nobody to stop you from being a hit online. Nevertheless, you can guide the current team to bag the best deal.
Understanding the behavior of the buyers is, no wonder, a challenging task. Usually, the grocery app owners have to face specific issues like buyers unable to collect their items timely, unpredictable habits of their buyers, and many more.<./p>
The only one-stop solution to this is to have a wide range of options for your buyers. Scheduling a delivery and pick-up time can help both the delivery men and your consumer happy.
Difficulty in Penetration in Small Towns
People in smaller areas are not so tech-savvy. It is easier for them to walk or stand in the queue to get the products needed. Moreover, businesses do not target these areas because they think they may have to settle upon thin margins.
However, if you could offer them some fantastic offers on using your online grocery store, you would have even that part of the consumer market covered.
Variations in prices are part and parcel of every business. Not only online but even offline stores are not immune to this problem. The variations in prices badly affect profit margins. Sometimes, they can make your balance sheet look the worst.
Thus, at such times, it is best to play safe. A conservative approach will help. Sustainable management strategies can take the front seat during this period.
Customers Not Being Tech-Savvy
Most people still tend to visit the physical grocery stores as they cannot appreciate the technology perks. Having a knowledge-transfer done for this group of people can be a tedious job.
However, you can help them explore the features and benefits they may receive online with ad-campaigns or any such promotional protocols of your grocery store solutions. In that case, you can surely add them to your list of visitors, thereby increasing brand advocacy.
The Freshness of Fruits and Vegetables
Fruits and vegetables depend upon the packaging, management, and delivery services. Customers always prefer buying fresh fruits and vegetables. Failure to this can put your business at stake.
Conducting proper rounds of quality checks on the perishable products can help. Ensure that the storage and warehouses are thoroughly and regularly cleaned. Make sure that the items are dispatched as soon as you receive the order to prevent them from getting depreciated before reaching the customers.
Marketing and Advertising Cost
Continual promotions bring down revenues. Retailers do not optimize the target audience making the promotions a costly affair for the business. Moreover, there are many strong players in the market, thereby turning the place more competitive.
The ultimate objective of online companies should be to build strong plans for app marketing. Promote your services by diligently calculating the profit margin.
Overcoming the convenience gap of grocery store problems is the key to have a successful online grocery shopping business. The challenges in the online grocery business can be easily overcome by using the omni channel retail solution Etailgrocer. Offering a customized digital experience will help you provide the customers with what they need. Gather actionable data for informed business decisions to your eCommerce solutions.