Growth: Making It or Breaking It?

E-commerce as a business category is itself a champion of growth. The UK e-commerce market, valued at £220 billion in 2024, is predicted to grow to £589 billion by 2029, a CAGR of 21.76% for the next five years (Mordor Intelligence). Despite a tapering off post-Covid, Companies House data (2024) shows that e-commerce still posts the highest growth rate of any business type in the UK, with over 288,000 e-commerce related companies registered.

E-Comm: Fuelled for Growth

Why is e-commerce such a growth-fuelled sector? We all know the Covid pandemic accelerated an upward trend in buying online and habituated millions of consumers to continue shopping via websites after high street retail bounced back. It also motivated thousands of entrepreneurs to breathe life into their own online businesses, tempted by low start-up costs, access to customers 24-7-365, and the ease of selling via established marketplaces like Amazon, eBay and Etsy. All this plus the rise of mobile commerce and creator-driven content on social platforms has given e-commerce brands even greater reach to engage new buyer audiences.

Potential Brakes on Growth

Despite these advantages, it’s sobering that 80 to 90% of start-up e-comm businesses crash within months of their first sale. Even for those that thrive early on, many go on to suffer growing pains later in their development. Sustained growth relies on not just acquiring new customers and making more sales, but also continually building brand trust to lock-in loyalty, drive repeat purchase and boost positive reviews and referrals. Delivering a consistent and rewarding buying experience to customers is essential, and this hinges on a web of moving parts working together flawlessly, from technology, marketing and financing to manufacture, logistics and talent. Letting any of these factors slip can quickly impact service delivery, dissatisfy customers, suppress sales and impede growth.

Customer-Centric is Healthy Growth

Successful e-comm brands find a way of consistently creating purchase experiences which are fully in tune with the personal needs and wants of their customers. From brand discovery to shopping, checkout, delivery and unboxing, the process is built to satisfy the buyer’s motivations, likes, habits, preferences and expectations. All this end-to-end customer-centricity helps to fuel growth by feeding brand obsession and driving repeat purchase. But extra demand can be a double-edged sword, great for top-line growth but more stress for the people, technologies, supply chain and processes behind the scenes working to get the right orders to the right customers on time and in the best condition.

Managing Spikes and Dips

At ILG some of our largest fulfilment customers are internationally renowned brands that ship thousands of orders per day, accounts that started with us years ago as very young e-comm businesses posting a few hundred orders per month. But, far from being a smooth upward line on a growth chart, the spectacular expansion of many of these companies over time often appears as a series of spikes and dips in customer demand, driven by factors such as seasonal buying, market forces, product launches, creator endorsement, marketing campaigns and entry into new markets or geographies. Whilst these demand catalysts are very welcome income drivers, some are completely unpredictable and can sometimes stretch operational capability to the limit.

Short-Term Scale-Up

So how do brands safeguard their customer experience at times of fast-growing demand without making a huge investment in extra capacity that could remain unused at times of lower order volume?

Outsourced fulfilment providers like ILG offer brands the aircover they need to give their customers the same high levels of brand experience and service, irrespective of how many orders they receive. An example is Black Friday Peak, the year’s traditional high-season for e-comm brands and fulfilment providers alike. No one can predict exactly the extent to which seasonal promotions translate into Black Friday order growth. But by consulting with brands to agree promotional timetables and volume forecasts many months in advance, the ILG operations teams are best prepared to minimise the risk of being challenged by unexpected high demand.

Meeting Peak Demand

Planning for Peak covers the receiving and checking of stock and optimising the location of specific SKUs within the warehouse to enable faster, more efficient picking. ILG adjusts its staffing levels in anticipation of Peak forecasts by recruiting extra people, running additional training and arranging more shifts. Co-ordination with carriers and other supply chain partners ensures synchronicity of operations throughout the Peak period. Meanwhile, stocks of product packaging, packing and labelling materials are topped up and automation and personalisation equipment are stress-tested in advance. We also run a Peak Incentives programme for all our colleagues to keep morale high as the workload ramps up during November and December.

As Peak proceeds this allows us to pivot our resources to meet our SLAs at times of greatest demand and allocate extra support to brands with the broadest needs. During Peak and other periods of volatile demand, this gives brands the ability to scale delivery of their customer promise consistently and cost-efficiently.

Supporting Longer-Term Growth

As well as helping e-comm brands get the most from shorter activity spikes, customer-focused fulfilment partners can help them plan for more strategic growth too. ILG supports the growth strategies of e-comm companies of all ages and sizes, from nascent start-ups and up-scalers to well-established brands backed by decades of trading.

For many younger brands we are their first experience of outsourced fulfilment, a significant step for business owners accustomed to running their own storage, picking, packing, delivery and returns operations. It takes a leap of faith and trust for owners to relinquish hands-on control, but outsourcing to ILG soon yields growth-friendly benefits like flexible and sustainable warehouse capacity, highly trained teams that size to match demand, value-added services, improved carrier rates, international networks and activity-based pricing.

We work closely with more established customers too, helping them realise their growth ambitions by relocating operations to new geographies, investing in new equipment and technology to up-spec facilities or recruiting and training new fulfilment talent to support the launch of new product lines or service offers.

At ILG we run 12 fulfilment centres across the UK and EU, from smaller 28,000 sq ft facilities to state-of-the-art 180,000sq ft warehouses. This offers each of our customers a flexible solution to match their growth well into the future. Our 40-strong customer service team can also scale the support it gives individual e-commerce brands as they grow and diversify.

Growth in international markets is important too. As UK e-comm brands attract more and more overseas customers, fulfilment partners need the bandwidth and reach to get D2C orders to long-distance customers quickly and at affordable prices. Choice of carrier is important to provide reliable options for getting orders from the UK warehouse to international destination. Or if our customers prefer, we operate two spacious fulfilment centres in central Europe from where we can distribute direct to doorsteps and retailers across the EU.

If you’re an upscaling e-comm business, we can help you through your growth challenges.