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Why small businesses are seizing the moment during the pandemic to sell online

Online sales have risen more than 44 percent compared to last year and, as more shutdowns loom, many small retailers expect this trend to continue.

The Philadelphia Museum of Art Craft Show draws nearly 200 artists from across the country together in one spot to create an extensive display of handcrafted works for sale. This year the show is going online.
The Philadelphia Museum of Art Craft Show draws nearly 200 artists from across the country together in one spot to create an extensive display of handcrafted works for sale. This year the show is going online.Read moreCourtesy Philadelphia Museum of Art Craft Show

Here’s something good that has come out of the pandemic. Because people have had fewer buying opportunities, the country’s personal savings rate is the highest it’s been in 30 years. Retail sales have continued to grow and consumer confidence is at a six-month high.

But the biggest impact on the sales of smaller retailers has been online. According to the U.S. Department of Commerce, online sales have increased more than 44% compared with the previous year and, as more shutdowns, quarantines and other disruptions potentially loom, many expect this trend to continue. Small retailers in this area know this, and many have been investing heavily in e-commerce to succeed this holiday season.

Elena Brennan is one example. Brennan, who owns Bus Stop Boutique, a designer shoe store on Philadelphia’s Fabric Row, believes that more of her customers will be buying online this holiday season rather than visiting her shop, so she’s been making her plans accordingly.

“We are adding new products and features to our website daily, and buying strategically and considering more critically the kinds of products folks will want to purchase during this uncertain time,” she says.

Brennan is still planning to increase her store’s hours and follow the necessary safety precautions for customers who want to shop in-person, but she’s now also offering free shipping and complimentary gift wrapping to attract more online shoppers. “Online sales are key to our business surviving during this time,” she says.

Jenea Robinson, who owns Marsh & Mane, a natural hair and lifestyle boutique in Society Hill, thinks that foot traffic will increase to her store this fall (“I’m sure people are sick of staying in the house”), but admits that no one is really certain what to expect. Her online sales have “increased significantly” due to the pandemic. So going into the holiday season, she’s offering more deals and bundles for customers visiting her website, “just in case.”

The significant increase in people working from home has created other potential holiday sales opportunities for entrepreneurs that cater to this audience. Two entrepreneurs who do this are the owners of Lobo Mau, an environmentally friendly clothing manufacturer based in South Philadelphia.

“We see a big opportunity in work-from-home attire,” says Nicole Haddad, who co-owns the business with her brother Jordan. “We are working on a really comfortable but extremely fun collection to brighten up our clients' spirits. It’s going to be a long winter, and we need fun clothing to get us through.”

Haddad’s business has always relied on face-to-face relationships and interactions at craft and clothing shows, but most of that has shifted online. So she’s shifting with it. “This year we will be doing everything via Zoom,” she says.

She noted that the Philadelphia Museum of Art Craft Show is online this year.

Zoom and other online conferencing platforms have helped small businesses maintain relationships with their customers. But many small retailers have invested in other tools to help them sell their products online.

They have created e-commerce portals on their websites by leveraging popular software like Shopify, Magento, BigCommerce and Wix. These applications and others have built-in features for quickly adding inventory, integrating with a store’s point-of-sale system, and adding payment and sales tax handling via such programs as PayPal, Square, ApplePay and Avalara. Other small businesses are selling more products via Instagram and Facebook, and millions of others are choosing to create a presence on popular online shopping platforms such as Amazon, eBay, or Etsy. Etsy, for example, now says it has more than 3.1 million sellers, up 34% since last year, and more than 60 million active buyers, a 41% increase.

It’s still not easy for a small business to succeed online, and particularly competing against the giants like Amazon and Walmart. Which is why many are looking for ways that can give them a leg up.

A number of small sellers online are building inventories to take advantage of the special shopping days ahead, such as Small Business Saturday, Black Friday, and Cyber Monday.

“Not everyone is going to be able to physically visit the store this year, and we want to make sure that our full stock is accessible to every client, and that they can ask questions and purchase gifts through a seamless virtual process,” says Josephine Clark, who owns Shop Kin, a specialty retailer in Center City. “A lot of families will be spending the holidays apart this year, so I think we will be doing a lot of shipping.”

Megan Brewster, who co-owns Art Star in Philadelphia, has always relied on in-person events at her two retail locations, but that stopped because of the pandemic. So she’s expecting this holiday season to be slower than usual. But the good news is that her online sales have been growing, and she’s focusing her energies on strengthening her website to handle the increasing demand.

Brewster has also been hosting virtual craft bazaars, “which have been very successful,” she says. “We’ve hosted three so far, and we are going to host a Holiday Virtual Art Star Craft Bazaar that will launch on Black Friday.”

It’s been a tough year for many small retailers, but thanks to the internet, many are heading into the holiday season with high hopes. “I feel ready,” says Marsh & Mane’s Robinson. “As an entrepreneur, you become used to taking risks. We will navigate this storm like we have all the others this year.”

Gene Marks is a certified public accountant and the owner of the Marks Group, a technology and financial management consulting firm in Bala Cynwyd.