A One-Stop Shop for E-Commerce
Most bricks-and-mortar retailers are evaluating their clicks-and-mortar strategies in light of the booming online shopping trend. The reality, however, is that going online is not always easy or cost-effective.
Hiring an information technology (IT) staff or choosing a hosting service can run into the six figures and take away from the creative side of business. To avoid that scenario, technology companies are starting to provide full-package services. One of those companies, Los Angeles–based Onestop Internet, is offering a turnkey e-commerce solution that features everything from Web site design to customer service to packing and shipping. The big driver, according to company executives, is that there are no upfront fees involved. Onestop makes money by taking a percentage of each sale.
Onestop, in two and a half years of operation, has corralled an impressive list of clients, including Von Dutch, C & C California, True Religion, Teenage Millionaire, Trunk, Alpine Stars and Allison Burns Los Angeles.
The company is led by Brett Morrison and Steve Tandberg, IT engineers who survived the dot-com bust several years ago. That experience has helped the company stay profitable from day one. Morrison raised $21 million in capital for digital imaging company Ememories.com before selling it to PhotoWorks, another Internet business. He and Tandberg later hooked up with Von Dutch, selling products on the Internet, and leased 30,000 square feet of warehouse space next to the company’s downtown Los Angeles warehouse. Business grew from there.
Onestop is one of only a few companies that take e-commerce to the fulfillment level. Clients provide the inventory, and Onestop takes it from there. “We come in as their white knight,” Morrison said.
The company’s business development director, Kirk Tedeski, said that outsourcing IT does not mean surrendering control. “In fact, the client has total control,” he said, explaining that clients can pick and choose how much they want to outsource. Some choose to take control over their inventories and shipping, while others pass on the responsibility. Onestop also has inventory management software, which gives clients a clear insight into what is in stock and what has been sold. “It’s very transparent,” Morrison added.
The commissions, based on a percentage of retail sales, work out to being about 50 percent more than wholesale transactions, Tedeski said.
The situation usually is advantageous because most companies do not make money on e-commerce vehicles, Tedeski said. “Instead, a Web site could be their biggest storefront,” he noted.
The challenge for manufacturers doing direct sales is to not alienate their wholesale clients. Manufacturer Web sites can actually enhance business for wholesale customers because they usually sell product at suggested retail prices and maintain price integrity, Tedeski explained.
With online sales growing 25 percent annually, most companies are becoming involved in some type of Web venture. Some are opting for vehicles such as Yahoo Stores and Amazon.com. Morrison challenged the quality level of those sites. “Our designers have a way of making things look 3-D. It’s a big difference,” he said.
Onestop has its own customer service department, photo studio and fraud prevention program. It also has the ability to help eliminate counterfeiting by canceling eBay auctions that sell knockoff goods.
In light of the heavy knockoff nature of the apparel business, more consumers are opting to go to the source for their purchases, including manufacturer Web sites.
Onestop executives eye a bounty of growth, given the increasing popularity of online retailing. They said, however, they are being selective in choosing partners, opting to take on clients that show growth potential and have some established volume. For more information, visit www.onestop.com, or e-mail info@onestop.com.
