5 Ways to Cut E-commerce Management Costs

The world of e-commerce is an exciting place to be right now, filled with potential for growth.

In the UK (the most advanced e-commerce market in Europe), up to 87 percent of households made online purchases in 2020, setting a new booming record. As well as being a growing market, it is also a highly competitive one. For e-commerce business owners it’s important to review all aspects of management and tools that may be available to them in order to maintain a competitive edge. Reducing costs is an important way to help make your e-commerce business more successful. Read this article to find out if there are any areas you might be able to cut your expenses and make your sales more profitable.

5 ways to reduce (or cut) costs for your e-commerce business:

  1. Retain your existing customers
  2. Cut down accounting management and bookkeeping costs
  3. Reduce shipping costs
  4. Evaluate your marketing channels
  5. Inventory management

Various studies show that it costs less to retain existing customers than it does to find new ones. Finding new customers is difficult, and requires a lot of money spent on marketing, as the first purchase is the hardest to get. These extra costs aren’t needed for your current customers. An oft-cited statistic from “Leading on the Edge of Chaos” claims that a 2% increase in customer retention has the same effect as cuttings costs by 10%. So save your money on expensive strategies for attracting new customers and focus on these tips for having repeat and loyal customers instead.

One important aspect of caring for your existing customers is to provide excellent customer service. Try to offer your customers 24/7 support so that can you deal with any issues that arise, this way you can keep your customers satisfied and hopefully avoid returns or worse, a bad review. You can offer support via many different channels, as long as you make it convenient for customers to get hold of you.

In general, show your customers that you value them. Keep in contact and you can also offer them a special discount for their next purchase. Ask your customers for feedback and thank them for their business. Put in the extra effort to satisfy your customers so that they become returning purchasers. This is a vital way to cut costs and achieve more financial success.

2. Cut down accounting management and bookkeeping costs

Accounting is one of the most important aspects of running an e-commerce business and includes recording your transactions, refunds, managing taxes and reconciliation. Make sure you find the best way to take care of your accounting and bookkeeping while also cutting down on extra accounting management costs.

Chances are, you already use accounting software such as QuickBooks or Xero, however, if you are inputting your data into the accounting system manually then there is an important next software step to take. As your sales and number of sales channels start increasing, trying to manually input all your data is extremely time-consuming and can lead to serious errors which cost you money. Importing the data into your accounting system automatically is therefore a vital step. Use one software to import your sales information from every sales platform and payment processor into your accounting system.

For example, you can use software such as Synder to automatically import all of your sales data from (for example) your Shopify and Amazon stores into QuickBooks automatically. Synder can connect multiple e-commerce platforms (such as Stripe, Paypal, eBay, Etsy etc.) simultaneously. The important thing is to use one accounting software to connect them all, as it is more cost-efficient than dealing with multiple apps.

Synder also has an invoicing feature that can take care of recurring invoices, this helps businesses make sure they receive their payments on time. Using the Invoicing feature, you can create and send invoices (both one-time and recurring) with a direct payment link that allows customers to pay them right away. All the created invoices are automatically synchronized, and as soon as the payment is received Synder automatically applies it to the corresponding invoice and closes it in accounting.

When e-commerce businesses don’t keep on top of their financial reports, reconciliation or tax preparation, expensive mistakes can be made. But by automating these steps the accounting and bookkeeping process is dramatically more efficient, accurate and saves your resources.

3. Reduce shipping costs

No matter whether you are a small or large business, delivery costs are one of the biggest overheads for e-commerce companies. That’s why it’s well worth making sure your shipping is as cost-effective as possible. You can start by looking at your packaging costs.

First off, figure out the exact measurements of your products and how often you send them to identify the types and sizes of packages you will be sending most often.

Once you have that identified, it’s important to choose the right box dimensions. Shipping is calculated not just on weight but on the dimensions of the package, the bigger the box, the more expensive the shipping, so aim for as little wasted space as possible. If you sell small, non-fragile products, mailer envelopes or poly mailers are a perfect space-saver and can even be slipped into a standard letterbox. Poly mailers cost a lot less to send, making them a great solution to use instead of boxes.

A second tip is to always research a range of shipping carriers. Compare their pricing offers and discounts to find which shipping company can offer you the best prices. Of course, the more packages you ship the better rates you can get, but even smaller e-commerce business shouldn’t be afraid to try negotiate volume discounts.

4. Evaluate your marketing channels

If you are paying for ads for your e-commerce business, it’s a good idea is to use free tools such as Google Analytics to evaluate your online marketing channels and compare which ads are giving you the best return on investment.

Google Analytics is the most used tool for analysing online business performance. It tracks user traffic and reports the outcome of your ad campaigns so that you can track where your marketing money is going. Invest the time in analysing the reports and insights so that you can see which marketing campaigns are effective and profitable and which are not. Then you can easily cut the campaigns that aren’t working as well and only spend money where it’s giving you the best return, thereby cutting down the costs of your marketing budget.

5. Inventory Management

Managing inventory for an e-commerce business is not something you have to do manually, in fact, in order to be prepared for growth it’s vital to use technology to keep on top of things. Tracking inventory is important for e-commerce businesses with large numbers of orders and deliveries, especially those with orders from many different sales channels. This can be done automatically with inventory management software, which is an effective way to avoid costly errors such as overstocking or overselling.

With technology assisting them, businesses can have an accurate account of their current stock at all times. Using software is worth it to save time and to reduce the costs of storing dead stock, or the costs of losing customers due to overselling, underfilling and not having their favourites in stock. There are many different inventory management software available, you can find a list of the top 5 here.


In order to stay competitive, e-commerce businesses should always be looking for ways to reduce expenses. Focusing on existing customers, reducing shipping costs, analyzing their marketing, intelligently managing inventory and using accounting automation are some important areas to review. We highly recommend Synder as a place to start, it’s a perfect all-round tool for any e-commerce business. From analysing financial reports to automating time-consuming processes, the app is a cost-saving solution. You can test Synder with a free trial.