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Most small online sellers working two jobs to survive

Two in three Australian small-business online sellers struggle to turn their businesses into full-time jobs, with 65 per cent working a second job or running another business to survive.

That is according to a recent survey of 193 small-business online sellers in Australia by international money transfer service WorldFirst.

The sellers surveyed largely sell products online, from categories including home and garden (31 per cent of respondents), health and personal care (22 per cent), clothing and accessories (15 per cent) and toys and games (15 per cent).

But while research shows small businesses are seeing faster online retail sales growth than their larger counterparts (3.9 per cent month-on-month growth in May compared to 1.2 per cent month-on-month growth, according to NAB), the survey by WorldFirst revealed that most small online sellers are struggling to survive.

Almost half of survey respondents (47 per cent) said they are employed full-time or part-time in a job, 24 per cent are seeking to quit those second jobs, while 18 per cent run at least one other business. Just one quarter (23 per cent) said their e-commerce business is their full-time job.

The survey further revealed the hours these small-businesses spend running their business. Forty-two per cent spend more than 25 hours a week, and a further 44 per cent spend up to 15 hours.

Thirty-two per cent spend most of their hours marketing their websites, 23 per cent spend most of their hours on product research, and 11 per cent spend most of their time on fulfilment.

WorldFirst managing director Ray Ridgeway said the arrival of marketplaces like Amazon have given small online sellers growth opportunities, but also created increased competition.

“The arrival of Amazon Australia diverts buyers from Amazon USA to our local marketplace, but it also increases the number of international sellers entering the local market,” he said.

“This is great from a consumer buying perspective, as more sellers means more product variety and also more price compression. It will, however, impact the local retailers and make it tougher to compete, if they don’t have good strategies in place.”

Ridgeway  noted that small business owners need to make every cent count, and costs of shipping, warehousing, website development and maintenance can stack up.

“If you’re a small business selling overseas, you’ll also need to think about currency conversion rates. Movements in foreign currency can significantly impact on profit, if a business doesn’t have a foreign currency strategy in place,” he said.

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July 5, 2018 at 8:42 am

This is a very intersting read, the reason being that a couple of my friends are in the ecommerce industry and have went full time around 4 months ago, they may have been lucky but they seemed to do well very quickly. They informed me the secret is to test which products work then double down on those.