Some call it the “new flex”. Others equate it to a “shape shift”. Whatever you call it, the retail industry has had to take standard notions of business agility to a whole new level – many having had to reinvent themselves virtually overnight in the wake of lockdowns. At the start of a new year, how can companies capitalize on what they have learned?
In a time when change often seems to be the only constant, retailers have realized they need more resilient systems that allow their organizations to transform without collapsing, whether that’s accelerating their transformation digital, to adopt rapidly scalable logistics, to switch between local and global selling or offering goods and services on different platforms in person or digitally. For example, having access to a mix of small and large suppliers means companies can be more responsive to changes in supply and demand. Likewise, having a robust and flexible payment system is essential.
“[During the pandemic], we have seen unprecedented change for our businesses, and many have had to evolve their business models significantly to continue to survive,” says Linda Weston, Head of Commodities at Barclaycard Business. “For many clients, it was about moving their businesses from brick-and-mortar, face-to-face organizations to more transactions in a digital environment.”
She notes that these transformations are not just about striving to maintain revenue in the midst of a crisis, but also about growing your customer base. With the acceleration of e-commerce, retailers have been able to look beyond their previous horizons, enter foreign markets and expand into new territories. “There’s been a huge growth of businesses moving online and also looking to attract new customers outside of their existing customer base – whether they’re from different industries or different geographies,” says Weston. “It can be a real eye-opener once you’re in this e-commerce environment. Especially if you’re selling something unique, you can attract customers from such a broad demographic, and the world is yours.
Expand horizons and improve your online game
Small and medium-sized enterprises (SMEs), in particular, have a lot to gain from upping their online game. “Business owners have realized that it’s easier than they thought to start an e-commerce business, and it allows them to consider their cross-border capability,” says Weston.
However, while realizing the new possibilities and potentials of cross-border e-commerce is exciting, it can be perilous without good advice and know-how.
Nick Maynard, head of research at fintech and payments analyst Juniper Research, urges those making the leap into cross-border trade to “take the time to understand their target markets.” He says: “Payment methods vary widely from region to region, so it is essential to ensure that they accept popular methods in these regions.
“Additionally, an understanding of fraud trends will ensure sellers can mitigate the most common fraud methods in the target market. A robust gateway with local experience can help solve these problems and is increasingly vital as e-commerce goes global.
Control foreign exchange and improve transparency
UK e-commerce trade association IMRG has reported a 57% year-on-year increase in outbound e-commerce sales from the UK in 2020. But it may be too easy for businesses to lose revenue from cross-border card payments due to currency fluctuations.
To help, Barclaycard Business has introduced Multicurrency: an integrated foreign exchange (FX) solution that allows customers to accept payments quickly and efficiently in over 100 currencies. “One of the main things that companies have to deal with if they’re selling overseas is currency fluctuation, so they don’t end up losing their account,” says Weston. “If the FX suddenly changes, they could potentially run at a loss.
“Barclaycard Multicurrency offers our customers, who all rely on cash flow, greater financial security. For example, it allows them to accept payments in the cardholder’s local currency and pay in British pounds. Additionally, they can fix the exchange rate for one or seven days, so they have an accurate idea of the funds they will receive for sales and adjust their price accordingly.
Weston points out that Barclaycard Multicurrency does not require any additional integration on the merchant side and indicates that customers of the Barclaycard payment gateway could also take advantage of e-commerce dynamic currency conversion (eDDC). This product allows purchasers of foreign-issued cards to choose whether they prefer to pay you in their local currency, with the price quoted automatically applying relevant exchange rates and fees.
“Transparency for online consumers is extremely important,” adds Weston. “The earlier you can provide transparency on the cost of the transaction in the customer’s checkout journey, the higher the conversion rate.”
In a world where businesses use both bricks and clicks – and also need to change form to keep pace with change and consumer expectations – deliver transparency and have the trust of an innovative, trusted payment partner and secure such as Barclaycard is essential for business.
To find out how Barclaycard could help your business with a range of physical and virtual payment solutions, click here