When Too Many Sales Hurt Your Small Business (It Happened To This Seller)

by G.B. Oliver

The dream of a lot of entrepreneurs is to set up an online shop and then hope for thousands of orders to come their way. But is that really want you want and what you can handle? Sometimes a surge in sales can actually kill your business.

How-to-grow-sales

I was reading an article in a business magazine about a successful online marketplace and the author was wondering when that marketplace was going to implode because it was based on artisans making their own products and not mass producing them to satisfy large wholesale deals.

This is a good reminder, that if you are a one or two person shop making your own products, obviously there is only so much demand you can handle.

Too Many Sales Hurt This Business

You don’t want what happened to a young, inexperienced vendor who started  selling her hand painted sneakers on one of the online marketplaces and quickly got more business than she could handle. At first it was wonderful having all that money coming in. But she couldn’t fill the orders quickly enough and they started piling up. She didn’t even have time to correspond with customers who were asking where their order was. The result – extremely unhappy customers that killed her credibility with negative public feedback, plus she had to refund customers money she had already spent. She was not prepared for success and did not have a plan in place to manage it.

What To Do in This Situation?

As soon as I couldn’t make one day’s orders, I would have put the shop on vacation mode or I would have indicated very clearly, “Due to popular demand, orders will now take 6 weeks instead of the regular 2 weeks. Thank you for your understanding”. I would have enlisted a trusted friend or family member to answer customer emails and inquiries while I focused on making the shoes. I also would have hired a student just to take care of the packaging and shipping. It may cut into your profits but you have to fill orders in the time you said you would, especially if you have already been paid. I would also scale back any marketing that was bringing in the surge of sales.

So What Is Your Success Plan?

What if more orders come in than you can handle, do you have a contingency plan in place?

  • Have you figured out how many sales a day you can realistically fill?
  • Have you allotted time for other business practices besides producing the products, such as accounting, marketing, customer service, etc.?
  • Can you afford to hire and train someone to produce products or is it only a skill that you have?
  • Do you have someone you trust who can handle the simple business tasks, such as dealing with customers, while you focus on filling orders?
  • At what point would you have to stop taking orders?

These are all important questions you have to be able to answer before you achieve the success you desire.

FINAL WORD: Always have a plan in place for success, just in case. The goal is to grow your business at a pace you can handle. So while you may desire more sales,  it is better that they come gradually instead of all at once.

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© 2013 G.B. Oliver. All rights reserved.

Author: Gail Oliver, Online Small Business Consultant

I'm Gail Oliver, an online marketing consultant. Welcome to my blog, chosen one of the Top 10 Small Business Blogs to Follow in 2014 by American Express Open Forum. If you need help with your e-commerce business, be sure to see MY SERVICES, above.