How to choose the right multichannel management platform
Posted: December 28, 2016
Selecting the right multichannel management platform for your retail business is not easy, and not something to take lightly. There are a lot of options out there, with new vendors seeming to come out of the woodwork all the time.
We'd like to help make your decision easier by walking you though the factors you will need to consider, and the questions you should be asking the vendors you are interviewing.
1) How many SKUs do you actively list? How many SKUs would you like to list once you have a channel management platform? Some systems are not built for high SKU counts. Much to our dismay, we recently learned that a popular low-end system for connecting with Jet and Walmart has a 1,000 SKU limit for new SKU uploads and feeds being sent to Jet. What's more, in order to send updated product data feeds to Jet and/or Walmart, the user needs to manually select which SKUs to send.
2) How many warehouses will you be using and how do you fulfill your orders? Believe it or not, not all channel management platforms support multiple warehouses. If you have inventory in multiple warehouses (FBA, own warehouse(s), dropship supplier, 3PL), you need to make sure your channel management platform can segregate these inventory levels and route orders to the correct warehouse.
If you want to use FBA inventory to fulfill orders from channels outside of Amazon, make sure this functionality is supported.
If you will be shipping from your own warehouse, make sure the vendor has an integration with a leading shipping platform such as ShipStation. Since efficiency is critical, think twice if you're considering a vendor that does not integrate with a best-in-class shipping solution and instead only has its own built-in label generator.
If you want to dropship from distributors and manufacturers, make sure the software vendor you select has functionality for automating core dropship processes like virtual inventory tracking, automatic PO issuance, and order status tracking.
3) Which channels does the vendor integrate with, does the vendor have official partnerships with these channels, is the vendor well capitalized? Most of the vendors in our space are neither employing world-class software engineers, nor experienced online retailers. As a result, there is an all-too-common situation where vendors hit a breaking point where poor architectural frameworks and the burden to maintain existing integrations becomes overwhelming and innovation and progress is halted.
If you're being told that an extremely high value integration such as Walmart Marketplace or Jet.com is "coming soon", you should ask yourself why they don't have this integration already.
If the vendor you're considering does not have an official partnership with Jet, Walmart, and eBay your performance on these channels will be stunted by delays and missing integration capabilities. Here's a link displaying Jet's integration partners.
Your multichannel retail potential is closely correlated with the power and ease of use of the multichannel platform you are using. If the vendor you're working with or considering is not profitable and well capitalized with funds necessary to grow to take advantage of the present major shift in ecommerce, then you need to take the steps necessary to protect your business from the very real risks of disruption and being left behind with inferior technology.
4) Price. Does the value you are receiving justify the value you are paying? As is true with most things in life, regrets arise when you underpay and overpay for necessities.
If you work with the cheapest solution on the market for quick and dirty integration with Jet and Walmart, you will soon realize the limitations of functionality and ease of use. What's worse, this low-priced solution has attracted a great number of small retailers that tend to require an outsized amount of support and rarely stick around. Accordingly, this vendor will have a hard time allocating the financial and engineering resources required to implement the features and enhancements critical to position their platform as a leading option for the long term.
If you work with the most expensive solution, you should have a good reason. Maybe you absolutely need the long tail of smaller or international marketplaces that most platforms don't support. Or you need EDI capability because you want to integrate with the dropship programs of some big box retailers. We have found that the most expensive, well established solutions are slow to onboard new customers, slow to innovate, and extremely inefficient and difficult to use. As a rule of thumb, if you're dealing with aggressive sales representatives that have limited knowledge of the industry and exhibit limited professionalism, you're dealing with a sales organization not a fast-moving technology partner.
Crunch the numbers, how much would it cost to run your business on a specific channel management platform? What features are you receiving, what features are you missing? Does your margin and business goals align with the platform you are evaluating?
5) What customizations do you require? What value-added services would help you achieve your goals? Do you use an ERP, accounting, warehouse management system that needs to be integrated? What pain points could be cost-effectively addressed by a feedback friendly technology partner? Few vendors are willing or able to integrate your data systems and take action on your feedback.
Would a cost-effective Google Shopping implementation help you diversify your online sales mix and allow you to build your own customer base?
Would an email marketing campaign tailored to each of your customer segments help you drive highly profitable repeat business?
Would business analytics and data visualizations help you make fast data-driven decisions to grow your business?
Is Zentail the right channel management platform for your business?
We do not currently offer dropship automation, so we are not a good fit if dropshipping is core to your order fulfillment strategy.
We do not currently integrate with Sears, Rakuten, Newegg, Amazon and eBay International sites (i.e. Canada, UK, Japan, etc.). If you want to centrally manage all channels, and one of the aforementioned channels is critically important to you, then Zentail probably isn't your best fit. Sears and Amazon and eBay international integrations are expected in 2017.
We are highly selective with the retailers and brands we decide to work with. We prefer to work with fewer high-potential customers whose operations can be transformed through intensive business process improvement powered by software.
Contact us if you're interested in learning more about multichannel management platform selection criteria.