How Online Marketplaces & B2B eCommerce Platforms are Fueling A Wholesale Renaissance
Image: NuORDER After a few years of destabilisation in the industry, the retail sector is undergoing a complete revitalisation fuelled by innovative B2B eCommerce solutions. Thanks to these new tools, brands around the globe can continue to reach new buyers and sell seamlessly online while providing their retail partners with the means to purchase at their leisure.
The rise of the internet altered the way consumers browse and purchase products for good. The emergence of e-tailing offered brands and retailers alike the possibility of selling their goods online directly to consumers, potentially eliminating the middleman. As brands today have more options than ever before to reach consumers and sell their products, some may think this would mark the end of either online marketplaces, wholesalers and B2B ecommerce platforms – many wondered if all of these channels would have a place in our new reality. But they would be wrong.
Recent research highlights the advantage of using direct-to-consumer models (DTC) together with wholesale partnerships with B2B ecommerce platforms and marketplaces. While some brands may have avoided going down the wholesale path, confident in their ability to succeed solely with a DTC model as it yields higher margins, studies from Coresight Research found that wholesale offers access to a larger customer base and more efficient marketing – even if it provides lower margins. Analysts at BMO Capital Markets found that selling via the DTC model alone does not guarantee bigger margins. In fact, from a group of leading apparel brands studied by BMO, four out of the top five merchandise margin-getters had robust wholesale revenue. Brands Gap Inc and American Eagle Outfitters, who invest minimally in wholesale, have merchandise margins below PVH and Ralph Lauren, two brands that lean heavily on wholesale as well as DTC, according to the report from BMO. Image: […]
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