About the Online Furniture Industry

The origin of eCommerce can be traced back to the 70s and 80s. However, it has not been long since eCommerce began evolving into the form in which we know it today. This contemporary form of eCommerce started with online businesses selling lightweight products like books and CDs. Twenty years back it must not have been easy to fathom that one day heavy and bulky products would also get sold via eCommerce. Furniture is one such product category. The question was not why or how furniture would be sold via eCommerce but why not. The answer to that ‘why’ came in the form of the required transformations and continued improvisations over the years in the supply chain capabilities.

Today, the online furniture industry is growing as fast as the needs of customers and business prerogatives are simultaneously accomplished. Businesses can cater to far-flung markets and customers have the option to choose from a plethora of styles, materials, and price brackets. The eCommerce websites/apps of reputed online furniture brands and businesses are as good as those of any other mainstream product categories or prominent online marketplace platforms. The emergence of progressive developments like Augmented Reality and Virtual Reality are helping add new dimensions to customer experience. At the same time, sustainability concerns are also being increasingly addressed in business models, sourcing, production, delivery, and disposal/exchange.

With all the good things on one side, there is no room for cutting corners in business planning and implementation. Every business is exposed to the same kinds of opportunities and challenges.

Challenges – from management standpoint

When it comes to furniture, the inherent nature of challenges of business owners is not very different from that of customers. Take, for instance, the problem of largeness with many furniture products. How often do customers alter the position of heavy furniture in their homes? This problem of bulkiness and heaviness also affects business as the products have to be moved from one place to another from production to delivery. Or consider the difficulties customers face in choosing a furniture product. The same difficulty also exists for businesses because, first, they have to conceptualise and develop suitable products and second, they have to help customers in choosing the right product for purchase. These and some of the other common challenges faced by business owners of online furniture stores are highlighted below.

Logistical Challenges

Handling furniture products for movement and storage is a heavy-duty operation. It is difficult for small and medium-scale businesses to justify investments in high-end mechanical solutions. Even for the big brands, these are long-term investments that must be supported by business volume. Also, during transportation and handling, heavier and bulkier products are not only more prone to incidents but even the extent of damage is costlier. For example, if a furniture product gets partially damaged during last-mile delivery, the customer will not accept it and will call for a refund or replacement.

Repeat Logistics

Product returns and exchanges are common in eCommerce. In the case of furniture products, the problem becomes more acute. First of all, it gives rise to reverse logistics which is stressful for businesses in terms of both time and costs. Secondly, in the cases of exchanges and replacements, the forward logistics has to be carried out again. It may be shorter this time but still, there are costs and efforts involved. Such repeat operations can significantly cut down margins. This makes quality control and carefulness in handling and transportation a serious task for online furniture stores.

Aiding customers with product selection

In the online furniture business, it is extremely important that customers make the right choices the first time. If they do not, they might call for replacements or exchanges – features which modern-day eCommerce brands cannot afford not to offer. Sometimes customers are not happy with the colour shown on websites/apps and the actual colour of delivered products. Sometimes the actual product dimensions do not fit the requirements of customers. Sometimes there are quality issues. Addressing these concerns is important for online furniture stores if they want to save the hassle of additional logistical burdens.

Meeting customers’ expectations

One of the barriers to meeting customers’ expectations that has already been discussed above is giving accurate representation of products in online storefronts. If this representation and detailing is not good enough, it becomes difficult for customers to choose products. This can be the termination of their shopping journeys. Even if they hastily make a purchase without sufficient data to make the right decision on product selection, they will end up being dejected with products not meeting their expectations. This can lead to requests for returns and exchanges increasing the costs and workload of businesses.

Validation is a common issue in online shopping engulfing online furniture stores as well. It increases uncertainty in making purchase decisions. Products that look like something in images and videos may not turn out to be what exactly customers expect in reality. Even with the reviews and feedback of other customers, there is still room for enough subjectivity on product quality or features.

Creating brand distinction is difficult and takes time

In the eCommerce space, it is difficult for online retailers to attain a unique brand positioning and identity.

First of all, for purely online brands, there is no scope for impressing customers with the elements of physical storefronts. The physical store or showrooms offer a big window to reflect branding objectives and aspirations. In eCommerce, businesses are heavily reliant on web and app development technologies, eCommerce platforms, digital content, digital marketing, UX, SEO, etc. in reaching out to customers and impressing them. If two online businesses use the same set of technologies and similar digital marketing approaches, it gets difficult to draw the lines of distinctions.

Furthermore, service plays a determining role in influencing CX. However, this requires that customers first give businesses a chance to showcase the quality of their services. Getting enough conversions and business volume to be able to shine with services at an extensive level is a time-consuming process, especially in the face of ever-increasing competition and dwindling market shares.

How YRC can help

YRC is a retail & online business consulting enterprise with global operations. With over ten years in business, YRC specialises in enterprise solutions for startups and existing businesses in both online and offline space. The firm has catered to over 500 clients in 25+ verticals with a success ratio of 95%. In online furniture store consulting, the team specialises in solutions for building business foundation and executing expansion projects. Some of the key services of YRC applicable to online furniture stores are highlighted next.

Market Research

In market research for online furniture stores, YRC’s goal is to help clients assess whether appropriate conditions exist in the market or not and the quality of those conditions to bring the business into existence and make it sustainable. YRC’s market research seeks to bring out insights on an extensive range of parameters. Some of them are highlighted below:

• Market gaps
• Customers’ needs and expectations, customer journey
• Potential solutions and value propositions
• Target segments, buyer and consumer behaviour, buyer personas
• Target market location(s), target market size
• Direct competitors, nature of competition
• Impediments to market entry and exit
• Prospects for business growth and expansion
• Pricing dynamics
• Brand positioning, CRM, customer loyalty, CX
• Current and impending challenges, opportunities, and risks
• Ease of doing business, etc.

Business model development for online furniture stores

With intensified competition among online furniture businesses, startups must get off with a robust and unique brand positioning. Achieving this often calls for surpassing the precincts of core offerings and predominant market standards on the grounds of value propositions. This ropes in the introduction of non-core elements like omnichannel, localisation, purchase points, loyalty doles, flexible pricing, etc. Today, online furniture store business models often accompany additional, value-based features to attain distinct brand distinction. YRC recognises these evolving requirements and the necessity of sticking to the fundamentals in executing its business model development services.

Financial & Commercial Planning

Relevant, detailed and accurate financial and commercial planning is one of the cornerstones of a successful enterprise. Not having proper financial and commercial planning can be an invitation to very difficult times. For example, not projecting (and controlling) the inflow and outflow of cash/funds can create a working capital crisis that can further lead to hindered operations. Similarly, not accounting for depreciation can bring sudden big expenses which then might have to be borrowed from the market at very high interest rates. With more than 10 years in business, YRC recognises the known and hidden aspects of financial and commercial planning. Grounds covered in this service are:

• CAPEX requirements
• OPEX requirements
• Demand projections
• Sales and revenue approximations
• Projected flow of cash/funds
• Projected P/L statements
• ROI and break-even analysis
• Relevant financial ratios
• Working capital requirements and any other variable of financial management as applicable

Operations Planning and SOPs

YRC maintains that in eCommerce, business processes demand not just quality and precision but also speed that matches the needs and expectations of target segments – if not better than then at least at par with competitors and prevailing industry or market standards. From inventory management to last-mile delivery, this applies to all the key operations of an eCommerce enterprise.

Process consulting that encompasses operations planning and SOPs is one of YRC’s core competencies and flagship services. YRC addresses process management with an inside-out approach. SOPs are the final output but the objective is to help businesses become process-oriented from the core. YRC also provides assistance in SOP-IT integration and in identifying the right IT solutions for business process management. This extends to assistance in vendor selection and securing the necessary support from the selected vendor(s) in software customisation and implementation. For more information on SOP templates for online furniture stores, please visit YRC’s official website and submit contact details.

Omnichannel Strategy

Going omnichannel helps online furniture stores overcome some of the burning challenges affecting this line of business. In the online furniture business, two of the biggest such challenges are creating brand distinction and helping customers make the correct choice. The solution is tilted more towards emphasising the physical touchpoints. Here, the role of online touchpoints begins to get dimmer after a certain point in the customer journey. YRC reckons these and many other subtle and strategic aspects in developing effective omnichannel solutions for online furniture stores.

IT Strategy

For an online furniture store, many important decisions have to be made pertaining to the technologies that will be used to run the business. These technologies have a direct bearing on routine operations, customer experience, ability to respond to competition, etc. YRC’s role here is to help online furniture stores identify the appropriate technological solutions for their business. To exemplify, one of the preliminary decisions to be made is about the eCommerce platform. It is the basic technological structure that ends up defining the features and capabilities of an online storefront. Another important area of work here is the selection of an appropriate eCommerce inventory management software for online furniture stores. A third one is CMS or Content Management System. YRC provides assistance in formulating a suitable IT strategy and in the selection and implementation of the required technologies. (Please note that YRC is not a technology maker and it only provides assistance in identifying and selecting the right technological solutions for business).

Digital Marketing Strategy

In digital marketing for online furniture stores, YRC’s goal is to help clients build a strong and appropriate digital presence cutting across channels resonating deeply with their target audiences. Target segments are identified. Buyer personas are detailed. Online behavioural patterns are mapped. Detailed study and analysis are carried out in these areas combined with inputs from market research. YRC emphasises that executing digital marketing in a strategic and planned fashion plays an instrumental role in ensuring that branding communications consistently reach the right audiences with the appropriate content on the right channels at a suitable time.

Functional Strategies

Functional strategies help keep the overall functioning of an enterprise aligned with its business model and other broader business goals and objectives. Having functional strategies is about having an approach to how the different line and staff functions work independently as specialised divisions and in tandem with each other supporting the business model and the overall business plan. While YRC deals with some of the critical line functions separately (like financial and commercial planning, operations planning, and IT), the strategies for the remaining functions are addressed here. The objective is to help clients quickly finalise the remaining functional strategies (HR, administration, etc.) with a planned and proven approach driven by YRC’s extensive experience in this field.

To know more about YRC’s online furniture store consulting services or to speak to one of YRC’s furniture business consultants, please visit the company’s website: https://www.yourretailcoach.in/contact/