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Setting up a Direct-to-Consumer Sales Channel

How manufacturers are using ecommerce to sell direct

Traditional supply chains make sense for traditional retail, but eCommerce has levelled the playing field. The barrier to entry to this market is massively lower than bricks & mortar retail.

eCommerce is also forecast to grow 53% in the period to 2020, in contrast with the decline of physical stores.

This is a growing market, with low barriers to entry, where 88% of consumers prefer to buy from the brand directly. No wonder that nearly half of manufacturers are working on a direct sales presence already.

Here's the steps they're taking and the key considerations they've got in mind.

Demand Analysis

Step one is to figure out what the market is worth, which channels they need to be on, and where in the world their products are in demand.

Picking a Partner

Next they look for outside help. Most aren't set up to deliver the type of experience customers demand, and lack retail expertise.

Staying Relevant

Whether it's through consultancy, internally managed, or an outsourced ecommerce team, the manufacturer must stay on top of its ecommerce presence.

Time to market

From our time working with retailers and manufacturers of various sizes, we've seen the market shifting towards direct-to-consumer brands and manufacturers for some time. What used to be isolated successes are now the norm. 

Analysing and understanding the market quickly means bringing more revenue in, sooner. Planning a direct sales channel shouldn't be rushed, but decision makers need access to real-time demand data, not historical information.

Painful disruption

Manufacturers are asking themselves: which processes will need to change? What specific work needs to be done, and who can do it? Do we have the capacity to deliver on this project?

Scalable solutions which minimise process alterations and reduce or eliminate the need for new skills and people allow manufacturers to adopt direct-to-consumer sales more easily. 

Cost-effectiveness

Of course, process change isn't the only cost to bear in mind. As most manufacturers will seek to use a consultancy, or outsource the maintenance of their ecommerce channel, they need to have targets for the return on this investment.

This begins with the demand analysis mentioned at the top - without this crucial information, manufacturers are working in the dark to establish the value of a direct-to-consumer channel. At Volo, we help to bring manufacturers through the process of demand analysis, and we offer a turnkey outsourced ecommerce team to execute their multichannel direct sales presence. 

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