eBay Isn't The Only eCommerce Site Struggling – eCommerce sales growth is slowing across the whole specturm

September numbers show only 5% growth. October will probably be the first negative number in several years. What should online sellers do?

E-commerce sales slowed in September to 5%, marking the fifth consecutive month where growth has been moderate, following:

  • April: +15%

  • May +12%

  • June: +11%

  • July +8%

  • August: +6%

  • September: +5%

A year ago, growth for many months sat above 20%.

Nothing can keep growing at double digit rates forever, some slowdown in growth was inevitable –but the recession seems to be taking its toll on all online sellers.  Amazon is probably the strongest player with Overstock the weakest and eBay somewhere in the middle.  Overstock announced today that they have been giving the market phony numbers for the past few years and that they will have to restate their earnings going back several years. Overstock stock dropped 13% today on the news.

If you are an online seller this sounds like bad news –and it is –but its not horrible news. We are in for what will probably be a long and deep recession. Unemployment could go as high as 10%.  That is pretty bad for the 10% that will be affected –but remember, 90% of people will still be employed and those people will spend money. Yes business will slow down but it will not go away.

So stick with your business.  Tighten your belt and watch your expenses. Get rid of unproductive inventory and use the cash to buy inventory that sells. All recessions end and this one will too.

Skip McGrath

www.skipmcgrath.com

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