In today’s digital world, e-commerce giants control how many consumers shop and how businesses operate. But for small and medium-sized businesses (SMBs), the effects are much more complicated and often extremely tough to navigate – not to mention expensive. Traditional e-commerce models not only charge high fees and present intense competition but also limit SMBs’ freedom and growth. Open Commerce is a new way for SMBs to thrive in a fairer, more transparent retail space.
Problems Faced by Small Businesses
Traditional e-commerce platforms like Amazon are leaders in global retail revenue and fast-moving consumer goods (FMCG), which make up the world’s largest commercial inventory. This includes groceries, cleaning supplies and health and beauty items. In 2021, FMCG sales accounted for 63.8% of retail revenue and by 2023, the global FMCG market had reached $11 trillion in value, with no signs of slowing down.
SMBs sell a lot of these products and account for over 60% of online sales. Platforms like Amazon offer SMBs access to a huge customer base but at a cost: they face high fees on every sale, high costs for storage and fulfillment and intense competition from other sellers and the platform itself. These aspects, combined, create a rigid landscape where many SMBs can’t turn a profit or sustain themselves beyond a few years.
Inventory management only adds fuel to the fire. Globally, businesses lose around $1.77 trillion annually due to overstocking or running out of stock. For SMBs stuck inside of this model, these issues can be especially brutal.
Open Commerce is the Way Forward
Open Commerce strays away from the controlled dynamic of traditional e-commerce platforms to create fair, transparent, and inclusive marketplaces. Enabled by AI, these new types of platforms empower SMBs and encourage fair competition by arming them with the tools and insights that were once only available to big businesses.
Read More: SalesTechStar Interview with Alex Saric, CMO at Ivalua
How Small Businesses Benefit
Open Commerce allows SMBs to show their products to a global audience on a more level playing field by linking sellers with brands, distributors and consumers. This not only drives innovation but also diversity in the market and more choice for the consumer, ultimately leading to economic growth.
Plus, is being used to make informed business decisions: from optimizing inventory to understanding consumer preferences and market trends. These help SMBs to be more efficient and customer focused. By removing the guessing and inefficiencies of traditional e-commerce, this technology allows businesses to focus on product innovation and customer engagement.
Fairness and Trust
Centralized e-commerce platforms like Amazon have been criticized for counterfeit products and fake reviews which erode trust and harm legitimate businesses. One study found that of Amazon’s 33.5 million reviews, 43 % of them were fake.
Open Commerce confronts these issues by leveraging some of the latest technologies. Data driven algorithms can contribute to confirming the authenticity of products, preventing reputational harm to honest businesses.
At the same time, data-driven algorithms can help determine optimal stock levels for stores, assisting organizations to maintain appropriate inventory levels, which can lead to reduced stock-outs, tackling another recurrent issue: inventory obsolescence.
Open Commerce is a transparent and collaborative marketplace where trust is built through real interactions and ethical business. By prioritizing authenticity and integrity, Open Commerce platforms build consumer confidence and loyalty, both key to business growth in the digital era.
The Retail Landscape Needs Change
As the global FMCG market hits $11 trillion, the need for a fast-acting and inclusive retail landscape is clear. Open Commerce addresses the immediate challenges for SMBs and creates an environment for a more sustainable and exciting retail future. By giving SMBs the tools and opportunities to achieve independence, Open Commerce drives innovation, diversity and consumer satisfaction.
Traditional e-commerce models have changed global retail and consumer behavior but their limitations for SMBs are now clear. Open Commerce is the new retail blueprint and presents an opportunity for a future where SMBs can compete on a level playing field, driven by innovation and guided by fairness and transparency. By adopting Open Commerce, all stakeholders in the retail ecosystem can work together to create a more inclusive and prosperous digital economy where all businesses can grow and contribute to growth.
About RedCloud
RedCloud Technology, founded in 2012, stands as a “Rebel Alliance,” leading a bold, second-generation e-commerce transformation. Rejecting the high fees of tech giants and Enabled by AI, RedCloud leverages supply chain solutions to empower smaller businesses, giving them the tools to compete with major corporations. Their democratized, cloud-based platform provides real-time financial visibility, offering a level playing field that breaks free from the dominance of conventional marketplaces. RedCloud embodies a fairer, more inclusive digital commerce future where Davids can stand tall against Goliaths.
Read More: Thriving in Today’s High-Speed Sales Environment: The AI Advantage
