How To Sell Online?

How do tailors sell online and through the post, without bankrupting themselves?

• According to the http://www.bbc.co.uk/news/business-21148508, "The rate of online return differs based on industry and location, but analysts say anywhere between 25% and 50% is commonplace." This corroborates those figures. So has any player in traditional menswear solved the problem yet? https://www.henrypoole.com sell only accessories online, avoiding the problem altogether. But this isn't the only option. Chttp://www.cordings.co.uk/, for example, sell their full range online. Many other less glamorous businesses do the same. How do they do it? Strict return policies? Videos about proper measurement? Or do they just bite the bullet?

• Answer:

  This is supposition, not knowledge but I think the equation for effective online retail balances the profit you make on a transaction against the rate of return. The profit pits the price your brand will allow you to charge against the effectiveness of your supply chain and the quality of your product. You can sell quality relatively cheaply if you buy at bulk and are ruthless with suppliers (Marks & Spencer) or sell average quality clothes at a considerable mark-up if your brand is strong (Hugo Boss). The rate of return will be affected by the quality of the item description and the measurements. Have a look at http://mrporter.com to see this done brilliantly. They include actual measurements, a comment on how the product wears and the measurements of the model wearing the garment. I have never had to return stuff to Mr Porter because it didn't fit. My mother orders from Marks & Spencer and Debenhams regularly, and will frequently buy 8-9 variations on the same item to try on and then return the others. For the retailer this requires the ability to effectively reprocess the returns back into stock, whilst charging for any damages of bad returns. I think there are two different types of retailers to consider: Firstly there are retailers with a large customer base, an existing meatspace retail operation and the logistics operation those entail. For these retailers the web sales are not that different from retail sales. In a  store you have large amounts of stock on display, more out back ready to make up for those sold and more in your supply chain, arriving just in time to make up for sales. Stock will sit on the shop floor until sold, or until the season changes - so you have an amount of stock unused. With web transactions you have an amount of stock in central storage (Meaning a less complex supply chain) and an amount of stock out for sale/return. Most of these returns will be able to be put back into sale, so you're probably not dealing with very different levels of tied up stock than in a retail environment. Compare this situation to makers of custom clothes. For custom clothes you will have either no clothing in stock, or part-finished stock ready for quick adjustment (Emma Willis does this with her factory adjusted shirts). This means returns cannot be recycled back into sale stock. Also, for most tailors the margin is probably tighter than on OTR clothes. These both increases the cost of a web sale. In my one experience of buying M2M over the net (With Tailor 4 less) they mitigated return risk by providing very clear instructions on measurement, additional details such as body type and also offered a small amount of credit at an alterations tailor. I didn't need this last option and I imagine the take-up is not great, but it should serve to reduce returns. Also, the Tailor 4 Less site makes no mention of returns - just alterations and remakes. I imagine their customer service dept does all it can not to accept returns. For most retailers I would think the problem is balancing the margin with the rate of return. A higher margin is harder to sell to customers, but allows for a higher rate of return. This is why I think it is easier to sell M2M suits online at the lower end of the market - £200-£700. Suits in this category can be made in sweatshops from very cheap fabrics. To move up the price ladder you either need a luxury brand or better quality. Better quality means lower margins, so the best option for a high price M2M suit online is probably from the likes of Hugo Boss or Reiss - middling quality with a high price tag. This would likely allow for the margins needed to support the return rate.