Small business owners often look to e-Commerce to boost brand awareness and generate new sales opportunities. However, with little resources, it is sometimes challenging for these entrepreneurs to understand the retail industry and see success.
PETSporium, an online retailer of pet products, managed to expand its sales from a single eBay marketplace into three eBay stores, an e-Commerce site and an Amazon store, with the help of market analytics solution provider Terapeak. Two years ago, as owner Glen Scott was trying to get the pet care business off the ground, he discovered Terapeak and subscribed to the company’s services after going through a free trial period.
Using Terapeak, PETSporium can analyze products sold on marketplaces such as eBay, Amazon, Yahoo! and Magento to measure supply and demand across the industry, predict optimal pricing strategies and determine the volume necessary to purchase. That way, when the company commits to a product, it has a very high chance of succeeding.
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“We do a whole vetting process any time we are ready to expand and bring in a new product line,” Scott stated. “We do the research and come up with some product candidates using Terapeak. Once we have about 10 or 20 candidates, we’ll sort through that and see if we have any current vendors that we get that from, and if not, we’ll research some more to find out where we could get it for what kind of price, and then start to build a relationship from there.”
PETSporium ships out more than 100 packages per day. Considering the majority of the items sold are small in size and do not take up a significant amount of space, the retailer can easily ship them out and even offer free shipping more easily.
Scott has joined the Terapeak Customer Advisory Board, which allows him to encounter and engage with other users — from young startups to established businesses that earn $50 million in revenue per year. Currently, Scott is exploring ways to expand his business into other categories, such as vitamins and sports supplements.
Building A Sustainable Business
Scott, who runs the business with his wife Patti, decided to implement Terapeak after using the tool to research products they had encountered and sold. Some of the product prices “stunned” Scott, as their listed values had been far off from his initial projections.
“We’d buy a group of products that were auctioned off that had been store returns,” Scott said in an interview with Retail TouchPoints. “You could bid on these and buy a lot at once. One of the things we purchased was a bundle of baby products, and in there were five of these little rubber giraffes that were a chew toy for toddlers. They wanted $20 for the giraffes, and I thought there was no way anyone would buy that at that price. We listed them to see what would happen, and they sold in one day. After the fact, I looked in Terapeak and searched the product, only to find that those products really sell.”
Scott also credits the platform in helping him understand that he needed to alter the business model from buying and selling liquidated stock to a more secure option that enabled inventory renewal more often.
“We initially looked at selling baby products,” Scott explained. “We were trying to sort through which direction we wanted to go in, and looked into how easy it is to source the products and what kind of margins we would get from selling them. We settled on pet products simply because there were more products overall, and they were a little easier to source.”
