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Few sectors ride the economic roller-coaster quite like the retail industry. From the impact of inflation and cost-of-living pressures to the rise of eCommerce and increasing global competition, CFOs and their fellow executives find themselves navigating unique challenges and doing their utmost to balance expenditure with quality. That is not an easy task at the best of times, let alone in a climate where Fitch Ratings is predicting U.S. retail volumes will decline at a low-single-digit rate in 2024, particularly in discretionary categories1.
Thrown into this mix is the post-COVID boom in online and social commerce that, coupled with advancements in artificial intelligence and the metaverse, is reshaping retail strategies. With more than 5 billion internet users worldwide2, global retail eCommerce sales are estimated to exceed $6.3 trillion in 20243 and the likelihood of further growth means some retailers are grappling with the role of traditional brick-and-mortar stores4.
Amid such sweeping changes, one thing that remains constant is that knowledge is power and there is no shortage of forums where CFOs can source quality insights and practical advice about how to stay ahead of competitors in this ever-evolving retail landscape. I had the pleasure of participating in one such forum in recent weeks when the National Online Retailers Association (NORA) invited me to join an online panel discussing how to secure top talent offshore as part of its ‘Future Workplace Transformation’ series.
Along with my MicroSourcing colleague Sean Baker, Barbeques Galore CFO Mitchell Koureas and Adore Beauty Group CXO Nicola Clement, we spent almost an hour exploring how outsourcing is a valuable tool for retail businesses of all sizes to address labor shortages, reduce attrition rates and extend service hours. As opposed to a brief chat, this was a deep dive into a resourcing strategy that is helping countless organizations streamline their operations and access specialized talent pools.
While I would urge all comers to stream the discussion, I know better than most that not everyone will have a spare hour to do so. For that reason, I’ve collated the best of our insights into an easily digestible article that takes readers inside the world of outsourcing and provides a blueprint for retailers and eCommerce outlets wanting to pursue a new way of building a team.
Outsourcing in retail and eCommerce sees organizations partner with external providers to perform tasks that would typically be completed by in-house employees. By outsourcing certain business functions, retailers and eCommerce operators can dedicate more resources to their core capabilities and seamlessly scale up or down depending on economic conditions. Along with multiple tasks being able to be outsourced, businesses can save up to 70% on labor costs by working with external providers.
There are myriad reasons for retailers to pursue an outsourcing strategy but the most popular include:
It is one thing to decide to outsource. It is another to do so in a responsible, strategic and ultimately successful manner.
It is tempting to answer this question by asking how long is a piece of string? That said, while the number of tasks that can be outsourced is extensive, there are several retail and eCommerce that particularly lend themselves to external assistance.
While our NORA TV discussion was a great insight into the world of outsourcing and offshoring, real change starts with a conversation. There is much to be gained from taking a different approach to resourcing in the retail and eCommerce space and that is where it pays to talk with an expert.
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About the Author
Nathan Stewart is a strategic leader who understands how to drive growth and build high-performing teams. With more than two decades’ experience in business development, he takes great pride in helping MicroSourcing’s clients achieve their offshoring goals in the Philippines while retaining full control over KPIs, quality, workflow and productivity.
Reference:
[1] U.S. Retailing Outlook 2024 (fitchratings.com)
[2] Number of internet users worldwide 2022 | Statista
[3] Global retail e-commerce sales 2014-2027 | Statista
[4] Online vs. in-person shopping | The Week
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