Amid the retail disruptions of the pandemic, consumers began shopping online more than ever before. But escalating e-commerce sales are not solely a positive for retailers’ profitability.
In AlixPartners and Sourcing Journal’s recent industry survey: “2021 Fashion in Focus: Investing in a Future Forged by Adversity,” respondents were largely split on whether the growth in online sales had an accretive or dilutive effect on their business, and a number were unclear on the impact. Serving a customer in store has a different cost structure than fulfilling online orders, and the labor, operational and other expenses for the latter can add up. This makes it more difficult to calculate the actual net financial result of digital sales, explained Bryan Eshelman, a managing director at AlixPartners, in a recent conversation with Sourcing Journal founder and president Edward Hertzman.
“It is a hard, tangled web of costs and activities to untangle and really truly understand,” said Eshelman.
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