Jason took over his family owned electrical appliances retail business 8 years ago, which was started by his grandfather in the 70s. It was a traditional family-run business which prides itself on service. Jason transformed the business and made the bold move to sell online, “It was a case of survival. There was no other way.” Jason explained. Jason chose to sell on eBay only, and not Amazon (yet), because of fees and logistics considerations. Today, 70% of Jason’s revenue is generated from his eBay store which has given him reach he never thought possible. His eBay business is surpassing his wildest expectations.
In terms of Competitive Advantages, Jason is on a level playing field with online retailers many times his size on cost of goods, as he has access to the same discount levels. On staff costs, Jason’s family run business gives him a low cost base and flexibility, with the bonus of offering “personal” customer service.
Jason finds that “Competition is ridiculous”. As the product specifications and prices are all assessable online, there is no room for product differentiation. Quite often it’s comes down to whether Jason has the stock or not. “Customers google and shop around. No one wants to pay more. We have to have the stock and be amongst the cheapest.”, said Jason.
Profit margin is low but it has always been the case for electrical appliances. So long as Jason can maintain the high turnover it is a profitable business.
The eBay store also generates a lot of foot traffic at Jason’s physical store, which gives him the opportunity to up-sell and impress his customers with his store’s customer service.
As prices are so sensitive, Jason really needed a solution that will both find his competition fast and also be able to track any price changes they make. Not only that, as most appliances (both Jason’s and his competitors) are listed on eBay with different colours, pack sizes and prices, “the solution needs to handle multi-variations“, as he put it.
Fortunately, as everyone uses the same supplier data with the same MPN and UPC, scanning for and locking down the competition is mostly a hands-off procedure with StreetPricer. StreetPricer is also able to detect multi-variations, quantities and prices in Jason’s and his competitors’ listings, which allows Jason to target precisely and exploit when his competitors are out of stock, if the colour is different or the price changes.
Adding to the hands-off approach, StreetPricer allows Jason to set his price rules and have the repricing done and updated automatically. StreetPricer gives Jason visibility on his competitor’s price movements, sales and quantity available over the last 28 days. This automation allows Jason to focus on his business of giving good customer service and not being caught unaware in this price-sensitive marketplace.
Jason has grown his family’s electrical appliances business from a local business to a substantial online business. He understands his customers’ price consciousness and he uses StreetPricer to deliver the lowest prices while maintaining his profit margin.