The e-commerce industry has been growing. With companies growing in Eastern Europe and Asia, the past few years have been good for the industry. Not to mention the largest growth the e-commerce industry has seen in its history in the first quarter of 2016. Also with the growing industry does not seem to be feeling the growing pains of the increase of the minimum wage. However, with all of these gains comes loses too. Since Silicon Valley is leading the world in computer advancement New York City has fallen behind. The city’s newest companies, many e-commerce, cannot find firms to invest in their business. Another loses on the international scale is Anand Chandrasekaran quitting the position of chief product officer in the company, Snapdeal. This news came as a surprise because he was only with the company for a year.
Who is Chandrasekaran in the E-Commerce World
Anand Chandrasekaran is a Stanford alum who played an important role in the company with Google. He was pivotal in India’s e-commerce world. According to Economic Times, “The Stanford University alum had joined the company in June last year from Airtel where he was the chief product officer. Chandrasekaran’s hiring was pivotal for the company at that time as rival Flipkart onboarded a Google executive, Punit Soni, to handle a similar role.”
Why is This New?
This article might seem strange because it is talking about India, not America. However, this is important because India is an important place for e-commerce. There are many jobs and companies in India, so what happens there is important for the rest of the e-commerce world. Also the fact that Chandrasekaran isn’t the only leading person in the e-commerce industry to step down from a company they helped build. According to Economic Times, “Recently, three key hirees – head of Flipkart’s ecommerce platform Mukesh Bansal, chief product officer Punit Soni and chief business officer Ankit Nagori, had stepped down. “
The countries that made up the Soviet Union have been laughed at since the became independent democracies in the 1990s. Those countries have been considered third world countries and have had plenty of internet scams that came out of them. However, more recently these former Soviet Block countries have been moving up quickly in the e-commerce arena. Eastern Europe is now the fourth largest region in the world in terms of B2C e-commerce. The region is also home to many emerging online retail markets. Analysts think it is due to the boom of e-commerce in Asia.
What Does This Mean for Eastern Europe?
According to PR Newswire, “B2C E-Commerce sales accounted for only a small one-digit share of the total retail sales in Eastern Europe in 2015, less than half of the shares in North America, Western Europe and Asia-Pacific. This is an indication of the potential for further online retail growth in Eastern Europe, supported by increasing Internet and online shopper penetration in its leading countries.”
This growth means that there is an increasing interest to start investing in Eastern European countries again. The better these companies can do in the next few months will be watched by companies and countries interested in working with the countries in region.
Why is this Good for Eastern Europe?
As the e-commerce begins to grow and evolve the better these companies will become and strong they will become. When this happens it will bring jobs and money into the region and hopefully end those jokes about how terrible it is to live there.
According to PR Newswire, “In other major markets of the region, including Turkey and Poland, online retail is also evolving. Important trends include the growth of mobile and cross-border E-Commerce, yStats.com finds. Smartphone penetration is growing across the region, with countries such as the Czech Republic having already surpassed a 50% smartphone penetration rate among the mobile phone users. Another interesting trend is the popularity of price comparison websites, especially in Greece, Romania and Hungary.”
New York City is struggling in the tech industry. The financial capital of the world is having trouble getting tech companies to do business here. This struggle is partly due to the tech boom in Silicon Valley. Now this is not to say that there isn’t a tech industry in New York, there are thousands of jobs in web design and development. After all, Union Square Design is based in New York. Also the city has pulled in $1.94 billion in this industry. However, that is quarter of what companies made in Silicon Valley.
What is New York Doing?
What is New York doing to help curve the tech industry back to New York and away from California? There is a startup called Tech:NYC, which is a non-profit that is trying to get more tech companies to come to New York City. The company works as a lobbyist firm to help with laws, rents, and prices to keep tech companies here. The Executive Director of Tech:NYC, Julie Samuels, has helped work with companies to stay in the city.
“New York is in a competition to be where startups are going to locate and bigger tech companies are going to grow second and third offices,” Samuels said.
Have These Tactics Worked?
Have these tactics worked to keep companies from moving to California? Yes and no. The problem with the city struggling to keep startups is startups are risky. Those companies aren’t looked for when venture capital firms are looking for clients. They look for a broad portfolio, not someone who started last month. So there might not be anything to worry about.
However, there are people who disagree,“Big exits really haven’t happened yet in New York,” said Fred Wilson, cofounder of Union Square Ventures. “It’s a valid criticism.”
The conclusion I draw from all of this paranoia is that we will have to wait and see if these startups actually stay in the city or move to greener pastures.
What is Magento is a question that is usually asked by people outside of the e-commerce world. Technically, Magento is an open source e-commerce platform written with PHP to provide online merchants with a flexible shopping cart system. It has many powerful marketing, search engine optimization, and management tools. If you understood that, congratulations you are probably in the e-commerce field, but if you didn’t it means that Magento is a WordPress for companies involved in e-commerce. If you don’t know what WordPress just google it.
History of Magento
Mangento started in 2002 and launched a 2.0 version in November 2015. Since 2002, Mangento has become a leading e-commerce platform. According to thepixel, The platform is already empowering over 200,000 retailed and 1 in 4 online businesses choose Mangento over its competitors. Why, because Mangento offers these businesses advanced marketing, search engine optimization and catalog management tools to control the function, the look and the flow of content for their unique business needs.
What Can You Do With Magento
Some features of Mangento’s functionality are its open architecture with many extensions for your whatever unique business plan you have. Including extensions for accounting, CRM, ERP,payment processing and many more. The open source aspect of Mangento is there to keep your business organize, but unique to your needs.
Not only does does Magento come with extensions to make your unique and simple, but it also comes with build in search engine optimization (SEO) software that creates user friendly SEO URLs in order for Google and other search engines to find the content easier. Also with its customized meta keywords and descriptions it makes it easy for customers to find your website.
Magento’s other extensions including a mobile app. So you can use it on your phone and hundreds of third party extensions for companies to use. With this and the other extensions it seems like Magento will continue to grow and expand in the e-commerce world.
Pitney Bowes is extending the reach of e-commerce with Cloud technology. The global e-commerce and shipping solution provider has created SendPro. SendPro is a cloud-based shipping solution created to keep track of business’s transactions. This technology will help people manage shipments with all of their different carriers.
What is Pitney Bowes’ New Cloud For?
Pitney Bowes is basically offering companies who use SendPro an all-in-one platform to manage their shipments and shipping costs. This way, customers will have access to the best and fastest shipping rates. This move by Pitney Bowes is a giant leap in e-commerce, because it meets the demands of the growing online shopping market.
How Will This Change the Game?
According to Business Insider, last month, the e-commerce company revealed its intentions to focus on helping e-retailers process orders and ship packages. Here is their basic plan:
Remove friction from the cross-border e-commerce market.
Ship more products internationally, which is easier since they acquired Borderfree, a company that specializes in selling and shipping products internationally.
Grow the company’s e-commerce business– it grew 11% in 2015 to reach $215 million
This move is great for the company. This could provide many more opportunities for Pitney Bowes. E-commerce is not just about buying goods online; it’s also about billing and shipping. This new technology will help businesses ship their products on time, at a good price. Pitney Bowes is focusing on how to get their Cloud used by other businesses, now that online shopping is so popular. The new SendPro mailing and shipping technology is a big help to small businesses especially. Small businesses have been using outdated, single carrier shipping methods. But SendPro takes away the stress of shipping for e-commerce.
In addition to this, Pitney Bowes is offering a three-month free trial of SendPro. This way, businesses can decide for themselves if the product is useful for their company without committing to it. Currently, millions of people use Pitney Bowes for their services already.
The worries over minimum wage increases have e-commerce companies cringing. There has been research done which says the increase in wages won’t hurt the industry. Since e-commerce has a lower labor cost, around 20%, these companies thought they could escape having to spend a lot more money. Also e-commerce companies are very small and bare bones, so it should hurt over all cost. This thought stopped much of the worry. However, this thought was wrong, now that areas are starting to apply the minimum wage increase to work. Now that the initial research was wrong, the next question is how could they have been so wrong?
The Research in E-Commerce Forget
The research in the e-commerce industry had forgotten was the internet and the sales industry. The younger generations such as Millennials and Generation Y are changing the retail industry. They no longer go into stores and do not have a lot of money. These two aspects are shrinking the retail industry. The industry is already shrinking due to online sales and may not be able to sustain its workers. This is forcing retailers to raise prices, which will hurt the e-commerce industry.
According to Forbes, the internet is losing retail stores a lot of business. Allen Questrom, an expert in these industries says,
“Retailers are in an existential bind: The Internet is for the most part, a money-losing business, but stores have no choice but to be in it, Questrom said Merchants are diverting capital from a moneymaking business [brick-and-mortar stores], and dumping big dollars into their money-losing online and mobile businesses, he said. A recent study from HRC advisory supports that notion, revealing that e-commerce, including the steep costs of fulfilling online orders, is chipping away at retail profit margins.”
It seems since the internet these giant stores and industries have been in decline. Now they are in a strange place and the future isn’t looking good.
E-Commerce takes hit from wage increase. One report states that warehouses with 500 or more workers may see an annual rise in labor cost by $1 million or more. This news might sound alarming to people who rely on cheap labor to keep their small business afloat. Also with the growth of the e-commerce industry it has made these companies move their warehouses and distribution centers closer to larger metropolitan areas.
Worries About the Increase in Minimum Wage
With cities like Los Angeles, San Francisco, and Seattle all raising their minimum wage far beyond the federal minimum wage of $7.25 it is likely that many businesses will have to find a way to cut costs. Sometimes this will mean to lay off huge numbers of their workforce and downsize using automation.
“E-commerce and other businesses that are tied to these dense locations will see the greatest impacts” according to Spencer Levy, CBRE’s head of research in the Americas.
Don’t Worry About the Big Bad Minimum Wage
However, e-commerce companies should not worry that much because the average warehouse worker make an average of $12 an hour which is well above the minimum wage in most states. So e-commerce and other industries can breath a sigh of relief.
According to the Wall Street Journal, most e-commerce business costs are in transportation, about 50%, and labor costs are only 20% of the budget of these companies. Also these companies have cut much of their labor cost by using automated computer systems, so their running on a bare bones business structure. So if you are worried about your e-commerce company up and moving you can relax, if you have a job with an e-commerce company it is likely that they need you to do a job for them.
So apparently the e-commerce industry will continue to grow for a while as some states are raising their minimum wage, while others have no plans to. It really doesn’t matter much to these companies.
3 E-Commerce startups in New York City everyone should keep there eyes on. There has been some talk of New York City has been lagging behind Silicon Valley in the tech industry, but these startups prove that this is just talk. After all, the reason people are saying these things about New York is because it has a lot of startups that don’t make it. Whereas, in Silicon Valley they had startups like Google and others that shot right to the top. But in New York no marketing firm in their right mind will give a startup a lot of money. This makes financial and economic sense but, it might be too conservative to have something like Google happen. However, here are some startups located in New York that have promise.
Upworthy is a startup that started a little over a year ago in New York City. The website’s mission statement is to make web content that matters go viral. The website is focused on empowering important content on the web.
The Muse started in 2011, so it is only five years old, but has made a huge splash. The starters of this startup were three women who decided to start their own career development site. They started it because they were sick and tired of sites like Monster and others which they believed were agonizing sites to find anything on. SInce its launch, The Muse has help over 2 million people find a job. They were successful by asking the question, “What do I want to do with my Life.”
Buzzfeed is a startup from New York. I was surprised too. It is hard to believe that Buzzfeed was once a startup since it has blown up into a major social media website.I mean on Facebook Buzzfeed has almost 16 million likes.