www.retaildive.com Open in urlscan Pro
2606:4700:4400::6812:2818  Public Scan

Form analysis
0 forms found in the DOM

Text Content

Skip to main content
Supported by
 * post
 * share
 * post
 * email

   
 * Reading Now Temu and Shein can weather de minimis changes. Others may
   struggle. By: Max Garland
 * Reading Now Tupperware shutters only US manufacturing facility By: Joelle
   Anselmo
 * Reading Now Holiday hustle: 43% of small business owners don’t track their
   inventory - should you? By: Xero
 * Reading Now What 8 DTC brands are talking about in 2024 By: Retail Dive staff
 * Reading Now Small businesses embrace digital payments By: Tatiana Walk-Morris
 * Reading Now Amazon proposes less packaging, more savings for its sellers By:
   Katie Pyzyk
 * Reading Now Michaels promotes online MakerPlace with ‘Respect the Handmade’
   By: Jessica Deyo
 * Reading Now Google announce new features for small businesses ahead of
   holiday season By: Xanayra Marin-Lopez
 * Reading Now More holiday shoppers to buy with small businesses: survey By:
   Tatiana Walk-Morris
 * Reading Now In challenge to Etsy, Artisans Cooperative marketplace launches
   By: Tatiana Walk-Morris

Supported by

Trendline


THE STATE OF SMALL BUSINESS


Gyorgy Bakos for Unsplash

NOTE FROM THE EDITOR

The U.S. depends on small businesses. More than half the people in the country
either own or work for a small business, and those companies create about two
out of every three new jobs annually, according to the U.S. Small Business
Administration. 

In recent years, large chains started to take the lessons of independent
companies and apply them at scale. The most impactful of those decisions may
have been bringing down the square footage of brick-and-mortar locations. At the
same time, independent retailers started to experiment with solutions that used
to only be available to mass marketers or large national chains. For example, as
technology improves and becomes more affordable, small businesses are able to
deploy savvy payment solutions, delivery mechanisms and other operational
improvements. 

The pandemic has impacted the trajectory of small businesses, pressuring many of
them and particularly squeezing stores that were deemed non-essential during
periods of required closures early on in the crisis. Small retailers tried some
of the same pivots their national competitors did in response — shifting where
possible to e-commerce or piloting new delivery options — but the challenges of
scale and competition that have always plagued those retailers haven’t
evaporated. And in many cases the ongoing uncertainty pinched small retailers
further by disrupting cash flow, employment and normal business. 

This trendline profiles small business leaders, delves into news impacting the
space and explores several topics facing small retailers as disruptions from the
pandemic, e-commerce and broader economic trends continue to bedevil operations.

 * Reading Now Temu and Shein can weather de minimis changes. Others may
   struggle. By: Max Garland
   
 * Reading Now Tupperware shutters only US manufacturing facility By: Joelle
   Anselmo
   
 * Sponsored Holiday hustle: 43% of small business owners don’t track their
   inventory - should you? Sponsored content by Xero
   
 * Reading Now What 8 DTC brands are talking about in 2024 By: Retail Dive staff
   
 * Reading Now Small businesses embrace digital payments By: Tatiana Walk-Morris
   
 * Reading Now Amazon proposes less packaging, more savings for its sellers By:
   Katie Pyzyk
   
 * Reading Now Michaels promotes online MakerPlace with ‘Respect the Handmade’
   By: Jessica Deyo
   
 * Reading Now Google announce new features for small businesses ahead of
   holiday season By: Xanayra Marin-Lopez
   
 * Reading Now More holiday shoppers to buy with small businesses: survey By:
   Tatiana Walk-Morris
   
 * Reading Now In challenge to Etsy, Artisans Cooperative marketplace launches
   By: Tatiana Walk-Morris
   




TEMU AND SHEIN CAN WEATHER DE MINIMIS CHANGES. OTHERS MAY STRUGGLE.

The e-commerce giants are already diversifying their supply chains, but smaller
businesses may have a tougher time adjusting to the White House’s proposal.

By: Max Garland • Published Sept. 23, 2024

The White House is making moves to limit China-founded e-commerce platforms
Shein and Temu’s use of the de minimis exemption, but industry observers aren’t
sure how much the plan will affect its intended targets.

The Biden-Harris administration’s proposal looks to cut off the use of de
minimis, which exempts shipments of less than $800 from import duties and taxes,
for a range of products covered by Section 201, 232 and 301 tariffs.

This would raise duties for many companies reliant on parcel shipping between
the U.S. and China, such as Shein and Temu, which experts say would likely
trickle down to price hikes for consumers who flock to the companies for a
variety of fast fashion goods.

Beyond the need to pay import duties, scrapping the exemption would also call
for standard reporting, bond and document requirements for these shipments, just
like other freight entries, Flexport wrote last week.

The proposal also aims to push businesses to provide more detail about goods’
destinations and shipments’ contents, such as describing cargo as a “100% cotton
men’s T-shirt” rather than just a T-shirt, Flexport added. The White House says
this will promote greater visibility into de minimis shipments.

“Some companies exploit the de minimis to conceal shipments of illegal and
dangerous products and avoid compliance with U.S. health and safety and consumer
protection laws,” according to a White House fact sheet. “Other foreign entities
use it to circumvent U.S. trade enforcement actions intended to level the
playing field for American workers, retailers, and manufacturers.”

--------------------------------------------------------------------------------

“Rules that face legal challenges, significant lobbying, or political
controversy can experience longer than normal delays. This one checks all boxes
and has logistical and technical hurdles that other [government] agencies will
present.”



Craig Radford

Co-CEO at Wizmo Solutions

--------------------------------------------------------------------------------

The White House’s efforts appear to be targeting Shein and Temu, but industry
observers say that the two e-commerce giants known for leveraging the de minimis
exemption can navigate these changes without much trouble. Smaller businesses,
on the other hand, could be strained by the added costs and administrative
requirements.


SHEIN AND TEMU COULD SKIRT THE IMPACT

Even with import taxes factored in, Shein and Temu are likely to maintain
competitive pricing versus U.S. retailers, Anthony Pizza, VP of marketing at
freight forwarder Accelerated Global Solutions, said in a statement shared with
sister publication Supply Chain Dive. Amid long-standing de minimis scrutiny,
both companies have expanded and diversified their supply chains to limit their
exposure to regulatory shifts, including by expanding their U.S. operations.

“Shein, for example, has expanded its manufacturing operations to countries such
as Turkey, Mexico and Brazil,” Pizza said. “The company has even begun producing
some items in the U.S. through a print-on demand model. Meanwhile, Temu is
adopting a semi-managed logistics approach to mitigate risks associated with
these types of policy changes.”

The changes could encourage further supply chain shifts by Shein and Temu, said
Cindy Allen, CEO and managing director of the consultancy Trade Force
Multiplier. One possibility is that Temu will ship more containers to U.S.-based
warehouses for storage, so that the actual sale occurs after it arrives in the
country. While Temu would pay duty on those containers imported into the U.S.,
it would streamline the entry process for the company if the de minimis
exemption changes are realized.

″[They’ve] gone from 5,000 individual packages in that box to one entry for U.S.
Customs,” Allen said in an interview. “It’s still going to have the same 5,000
individual items in that box, and they’re probably going to be individually
packaged.”

While Temu is monitoring de minimis developments, its growth doesn’t depend on
policy related to the exemption, a spokesperson said in an email to Supply Chain
Dive.

Shein wants reform on the exemption “to create a level, transparent playing
field,” and import compliance remains a top priority, a Shein spokesperson said
in an email.


Temu said its success doesn’t rely on the de minimis exemption that is under
scrutiny by the U.S. government.
Screenshot: Temu
 


HURDLES FOR SMALLER BUSINESSES

Smaller businesses that lean on direct-to-consumer shipping from China or the
resale of China-based goods in the U.S. may face a more sizable challenge in
navigating de minimis changes, experts told Supply Chain Dive. Many of these
companies lack the resources to quickly adjust their supply chains like Shein
and Temu can.

One hurdle for these businesses is to classify their 10-digit Harmonized Tariff
Schedule codes, which the proposal aims to mandate, according to Flexport. The
codes, which categorize imported goods and determine duty rates, aren’t always
needed for de minimis entries today. If that changes, importers would face more
customs requirements and related costs, since classifying products at the
10-digit level is defined as “customs business.”

“This would mean hiring licensed customs brokers, executing customs power of
attorney and establishing responsible supervision control procedures,” Flexport
said.

Temu and Shein can secure low customs brokerage fees due to the high volumes
they ship, but many other e-commerce enterprises don’t have that luxury, Allen
said.

“They’re going to be impacted by having to pay more duty, having to navigate a
customs broker relationship that they don’t have today,” Allen said. “They’re
going to have to pay higher costs.”

Still, there are some ways businesses can adjust their strategies to mitigate
the impact of the White House’s push, such as manufacturing in countries outside
of China. Companies could make products in Vietnam to skirt Section 301 tariffs,
said Izzy Rosenzweig, founder of e-commerce fulfillment company Portless, which
helps shippers utilize a Shein or Temu-like supply chain model.

As importers respond to the White House’s proposal, they should also consider
that changes to the exemption can happen as it advances through the
implementation process, Craig Radford, co-CEO at Wizmo Solutions, noted in a
LinkedIn post.

Trade-focused proposals also can take several months to finalize, he added.

“Rules that face legal challenges, significant lobbying, or political
controversy can experience longer than normal delays,” Radford said. “This one
checks all boxes and has logistical and technical hurdles that other
[government] agencies will present.”

Article top image credit: jetcityimage via Getty Images



TUPPERWARE SHUTTERS ONLY US MANUFACTURING FACILITY

The iconic food storage company will lay off nearly 150 employees as executives
worry about its ability to continue operating.

By: Joelle Anselmo • Published June 18, 2024

Tupperware is shutting down its only U.S. facility, laying off 148 employees in
Hemingway, South Carolina, according to a June 11 Worker Adjustment and
Retraining Notification Act filing. 

The job cuts are scheduled to take place from Sept. 28 through Jan. 14, 2025.

The food storage company sold its Hemingway facility last October and will
transition manufacturing operations by year’s end to its Lerma, Mexico, plant,
which already manufactures most of the products for its U.S. and Canada markets,
a company spokesperson told Manufacturing Dive.

Tupperware will offer eligible employees early retirement and severance packages
and provide outplacement services.

The nearly 80-year-old company cited the closure as part of a multi-year
strategy to simplify its supply chain and operations and create
efficiencies, according to the spokesperson. 

Tupperware is also navigating major concerns about its overall financial state,
saying in a March 29 quarterly securities filing that there is “substantial
doubt about its ability to continue as a going concern for at least one year.”

The closure of the South Carolina facility follows a rocky past two years for
the company. With a slew of operational and financial woes, Tupperware has been
trying to restructure its debt and make changes to its executive board, electing
former Spanx CEO Laurie Ann Goldman as Tupperware’s new CEO in October 2023.

In April, Tupperware disclosed that it hadn’t filed its mandatory annual 10-K
report to the Securities and Exchange Commission, prompting the New York Stock
Exchange to give the company a warning it’s at risk to be delisted if one isn’t
turned in the next six months. Tupperware has yet to file the annual report. 

The company also filed its Q1 2024 report late, saying the delays in filing were
due to “material weaknesses in the Company’s internal control over financial
reporting.”

Despite its financial struggles, Tupperware is still planning to invest in a new
third-party logistics facility in the Midwest, according to the company
spokesperson. The new facility will aim to offer additional capabilities to
serve its customers, reduce shipping times and implement new warehouse
technologies to better serve direct sales, retail and e-commerce customers.

The transition of the Hemingway facility’s production and establishment of the
new distribution center will happen in phases throughout the remainder of the
year, the spokesperson stated.

Tupperware has other manufacturing locations in Belgium, Brazil, South Korea,
Mexico, Portugal, China, India and South Africa, according to the spokesperson.

Article top image credit: Kaarin Vembar/Retail Dive
Sponsored


HOLIDAY HUSTLE: 43% OF SMALL BUSINESS OWNERS DON’T TRACK THEIR INVENTORY -
SHOULD YOU?


Sponsored content
By Xero
By: Ben Richmond • Published Oct. 1, 2024

Holiday retail shopping is showing no signs of slowing down this year, with
eMarketer projecting that total retail sales for the 2024 season will reach
$1.372 trillion - an almost 5% increase from last year. With this continued
growth comes the need for greater investment from small business owners in their
operational support systems, so that when the inevitable seasonal rush of demand
comes, they are well equipped to harness it for a boost in revenue. Whether
through an app ecosystem (like Xero’s) or elsewhere, small businesses are
increasingly well-equipped to manage their finances year-round, but one of the
lingering challenges on this front? Managing inventory. 

For small businesses in the retail environment, customer demand can ebb and flow
naturally over the course of the year. But it’s not quite as simple as “buy more
for the holidays and buy less in the offseason.” Every business’s customer base
has unique needs and timeframes around those needs, with any given product
moving at a different pace across different sales channels. Without the ability
to properly organize this information, businesses can fall into cycles of
accidental over- or under-stocking, ultimately hurting their profit margins and
stifling growth. Knowing when to spend more or less on stocking product can be
key to a well-regulated cash flow, but small business owners are far too often
overburdened with running the day-to-day aspects of their business to organize,
recognize and analyze these patterns – as evidenced by Zippia finding that 43%
of small business owners don’t track their inventory. 

Understanding why inventory management is so important, and the tools available
to make it doable on a busy schedule, can be a gamechanger for any small
business owner.  

On the frontlines of business ownership, there are often things you know that
you don’t know, but what about the things you don’t know that you don’t know
(read that three times fast)? Many of the available solutions for inventory
management can be entirely unfamiliar, such as the extent of reporting
capabilities available for product data like top performing products by customer
demographic and category, performance across separate sales channels, shipping
costs by region, inventory forecasts over time and more. 

This data can then feed the automation of tedious processes, like monitoring for
low stock on specific items and reordering said items. Equipped with these
tools, any business can optimize their inventory game (or build it from the
ground up). Many platforms today, like Xero Inventory Plus, unify these
functions under one roof and allow for these new capabilities to be seamlessly
integrated into a business’s day-to-day operations and decision-making. Not only
does this lessen the load for business owners, but it provides a new window of
opportunity for them and their advisors, accountants, and bookkeepers to sit
down and devise an in-depth approach to their product strategy. 

For businesses that develop an airtight grip on their inventory, what does this
mean in the long run?  

Not only does it result in a massive reduction in headaches around busy or slow
seasons, it can lead to direct improvements in a business’s profitability
through better customer targeting that increases sales, less waste, and more
comprehensive documentation for tax season. In fact, investing in inventory is
as beneficial for a business’s accountants and bookkeepers as it is for the
business owner themselves. With access to unified and automated reporting from
all channels at once, more of their time can be dedicated to strategic financial
guidance that helps to grow the business, rather than tactical
number-crunching. 

The days of disconnects between product stock and sales are coming to an end,
and just in time for retail’s busiest season of all time. Will your inventory be
ready for the rush? 

Article top image credit: Permission granted by Xero



WHAT 8 DTC BRANDS ARE TALKING ABOUT IN 2024

From Glossier to On, executives shared insights into what brands are facing
during the National Retail Federation’s Big Show and the ICR conference.

By: Retail Dive staff • Published Feb. 26, 2024

Over the past decade, DTC brands have evolved, causing executives to rethink
their strategies.

While many digitally native darlings originally vowed to avoid wholesale in
order to pass savings on to consumers, many of those brands are now inking deals
with retailers to expand their distribution network. On the other hand, more
established brands that previously leaned heavily on the wholesale channel are
now exploring the benefits of selling directly to consumers.

The changing industry has also led to a change of hands at several brands in
recent years, with founders stepping down in order to usher in more seasoned
retail leadership.

Executives with some of the biggest brands last month appeared at both the ICR
conference and the National Retail Federation’s Big Show, offering insights into
what DTC brands are thinking about in 2024.

Here are eight takeaways from DTC leaders heard during two of the industry’s
biggest events.


APL

“While we are a direct-to-consumer at our core, we always characterized
wholesale as profitable marketing,” APL co-founder and co-CEO Ryan Goldston said
at the ICR Conference. “We launched at Barney’s, Saks, Bergdorf, Net-a-Porter,
Mr. Porter, Harvey Nichols, Selfridges, Le Bon Marché, Level Shoes, Lane
Crawford — you name it, we were there.”

Co-founder and co-CEO Adam Goldston added that the brand spent nothing on
customer acquisition for the first decade of APL’s existence, leaving it to grow
organically. A partnership with Lululemon in 2017 also gave APL insight into
what kind of demand there was for its product and how the brand was received in
different markets. 

“When we launched with Lululemon, we became the only third-party brand and the
only footwear brand sold within their stores,” Ryan Goldston said, noting the
brand was sold in 23 stores in North America. “We could see how we worked in all
of these different markets, whether it was Fifth Avenue, New York; Third Street
in Los Angeles; Toronto; Calgary; Edmonton; Nashville; Denver; Dallas — all
these different places. In every market we went to, it worked.”


CASPER

“We were very loud in the beginning about like, ‘Mattress stores are terrible,’
and ‘It’s a crappy experience,’ and ‘We’re going to only sell online.’ Well,
that’s where 80% of the mattresses in the U.S. are sold. So we can either get on
board, or we can be small forever. Those are the choices,” Emilie Arel, Casper’s
former CEO, said during a panel discussion at the National Retail Federation’s
Big Show in New York in January.

Casper — one of the original disruptors in the mattress industry, promising to
pass savings on to consumers by eliminating the middleman and shipping products
directly to customers — backtracked on its DTC-only ambitions as it chased
growth. The mattress company now sells products through a number of
retailers, including Mattress Warehouse, Sam’s Club, Ashley HomeStore and Denver
Mattress.

“We chose not to be small forever and so we expanded into wholesale. It’s a
consumer decision coupled with an economic decision. The economics are different
in wholesale — sometimes better, sometimes worse. It depends on who you’re
working with and what the product looks like,” Arel added. “To me, it’s: Where
is the consumer? And what do the economics look like? And then go from there.”


CROCS

“We think both channels are super important, right? We’re not planning to be a
DTC company, we’re not planning to be a wholesale company, we are planning to
leverage both channels of distribution to effectively reach a very large
consumer audience,” CEO Andrew Rees said, noting Crocs is 50% wholesale and 50%
DTC. “From a geographical perspective, we’re also diversified, with about close
to 40% of our business from an international market.” 

International is expected to grow faster than the domestic portion of the Crocs
business, Rees said, “which gives us access to some fast growing, extremely
attractive, international scale.” CFO Anne Mehlman added that the retailer
reported record revenue in China in Q4, growing around 80% in that region.

“But yet China is still underpenetrated compared to the rest of the world,”
Mehlman said. “So still a big, long-term opportunity. We also had triple-digit
growth in Australia, and strong double-digit growth in a lot of our other
international markets.”

At Heydude, the company exited more than half of its “nonstrategic distribution”
and has pulled back on digital rights, Mehlman said. “We are very excited for
better product and channel segmentation in 2024.”


PURPLE

“It’s a mixed bag. We’ve got a third of those that are problematic for one
reason or another and we’re trying to put our finger on it because it’s the same
co-tenancy, it’s the same quality of location and yet two-thirds of them are
working and a third of them aren’t,” CEO Rob DeMartini said at the ICR
conference of the retailer’s store fleet. “They’re great brand beacons, but
they’ve got to make some money.”

Purple’s strategy has had some other rough patches as well, with DeMartini
noting that shoppers have shown “a real resistance” to buying expensive
mattresses online versus the more affordable options it became known for.
Profitability, however, could be reached this year, the executive noted.

“I mean, in all fairness, this company was on the brink for the last couple of
years,” DeMartini said, noting that Purple “misread COVID” and didn’t have a
good structure for wholesale set up. “I think we’ve turned the corner, we’re
going to get healthy and there are places this brand can go, but I don’t want to
get ahead of myself here. We’ve got to start consistently taking share in the
core business, in the core country, and then figure out how to grow from there.”


GLOSSIER

“We are on year 10 of building a 100-year-old brand,” Kyle Leahy, CEO of
Glossier, said during NRF’s Big Show.

The executive, who in 2022 took over as CEO from founder Emily Weiss, said when
Glossier launched in 2014, its mission was to change the way the world viewed
beauty. That mission remains largely unchanged because, Leahy added, the brands
that succeed for decades are the ones consumers can connect with on an emotional
level. Reaching those customers across various channels has also been pivotal to
its success.

“Ten years ago, this brand was incredibly disruptive in so many ways,” Leahy
said. “The integration of content and commerce: We were born out of a blog, Into
the Gloss, that Emily created. How do we think about community and commerce and
content all together?”


LOVESAC

“A sactional setup is typically $5,000, $10,000, $15,000 — $20,000 is not
uncommon because people are getting giant basement configurations with stealth
tech surround sound embedded,” CEO Shawn Nelson said at the ICR conference. “And
as we continue to invent those things year after year after year, they can add
it to what they already have. So this designed-for-life benefit to the customer
is unlike I think any other brand in product. Forget furniture — in product.” 

Nelson said the company is “one of the most successful direct-to-consumer
brands, if you want to call it that” and that its return on ad spend is “the
best there is.” The brand’s goal is to build products that last and a model that
allows shoppers to add to them over time, whether through more couch seats or
embedding storage or surround sound systems into them.

“It resonates with humans that have babies, kids, pets, dogs, friends, pizza,
wine,” Nelson said. “The product can roll with you as life changes and that
design philosophy, obviously, will inform all of our future designs and so we’re
working on more additions to this platform and the Sac platform.”


ON

“Performance, design and sustainability: This is the DNA of the brand and
performance is at the core,” Martin Hoffmann, CFO and co-CEO, said at the ICR
Conference. As a result, the number of athletes wearing its products is
important, but so is the everyday shopper. “Because the product feels good, it
looks good and it’s sustainable, it also addresses the huge lifestyle customer
community, which is of course something that is very much intended. At the same
time, we need to balance both customer groups. And I think this is what we are
seeing.” 

On is increasing share with both runners and everyday shoppers, Hoffmann said,
opening up opportunities to expand into new sports and categories. Training is
one such opportunity, which is the first expansion where On will launch apparel
before footwear, co-CEO Marc Maurer said. The company has five co-founders,
three of whom are now “very much involved” on the product side, according to
Maurer.

“The five of us basically can control the direction of the company through our B
shares, which is super important because you know, we’re building this for the
long run — and we don’t really care about the next one or two weeks, but we care
about what’s going to be the legacy in 20, 30 years from now,” Maurer said. The
leadership team has grown much bigger since its founding and is much more
diverse now, he added. “I think this is a journey that we will continue in order
to make sure that in the long run, innovation and also the operational
capability lies in the company and not with just one or two people.”


BROOKLINEN

“How do you maintain the things that make the company special? But how do you
drive more accelerated change?” Brooklinen CEO Billy May said during NRF’s Big
Show last month.

May, like Casper’s Arel and Glossier’s Leahy, succeeded the brand’s founder as
its CEO. In July, Brooklinen co-founder Rich Fulop announced he would step down
as chief executive and in October, May was appointed CEO. During the panel
discussion, May noted that in a lot of founder-led businesses, like DTCs, nearly
every decision comes back to the founder. And as those brands scale, May added,
it becomes increasingly difficult for founders to continue to make every
decision, “but a lot of founders fail to recognize that.”

“When you move from a single failure point, to trying to drive more
accountability and decision making down into the organization, that requires a
change in the way you look at the business, how you manage the business and how
you affect the day-to-day operations of the business,” May said.

Article top image credit: Courtesy of The National Retail Federation


SMALL BUSINESSES EMBRACE DIGITAL PAYMENTS

Small business owners envision a cashless future, according to Visa, even as
some legislators move to protect unbanked and underbanked consumers.

By: Tatiana Walk-Morris • Published Sept. 22, 2023

As small businesses pursue international expansion, their evolution might
involve adopting new payment tools, a recent survey from card network company
Visa revealed. 

Small and micro-businesses envision a cashless future, and they’re investing in
payment technology as part of their growth strategies, Visa’s survey results
showed. In the card network’s global survey of 2,250 small and micro-businesses
and 1,500 consumers, more than a third (35%) of business owners surveyed said
they are considering accepting new forms of payment as a critical way they can
improve their businesses.

About 95% of small business owners planned to become cashless “someday,” and
more than half (51%) anticipate going cashless in the next two years.

“Our previous data has shown that small businesses that embraced digital payment
technologies over the last few years were more resilient and better able to
compete than those who did not,” Jeni Mundy, global head of merchant sales and
acquiring at Visa, said in an emailed statement.

To be sure, Visa has an interest in businesses being more digital in their
payments schemes because credit and debit cards are often used in those
channels. In any case, the COVID-19 pandemic super-charged a worldwide trend
toward increased digital payments.

Nearly eight in 10 business owners said they are expanding to new markets to
drive growth, Visa said. Among other measures small business owners expect to
fuel growth are: bolstering their social media presence (44%), offering new
products or services (41%) and increasing marketing investments (40%). 

“It used to be that only big businesses could scale to access customers across
the country or around the world, but today’s small business owner can be
virtually borderless,” Mundy said in the release. “At Visa, we’re seeing the
small business mindset shift from survival mode to growth mode, as SMBs harness
the power of digital payments to improve efficiencies, reach new audiences and
simply thrive in today’s increasingly digital world.”

The shift toward accepting new payment technology is partly driven by changing
consumer behavior, Visa’s survey suggests. More than half (55%) of consumers
surveyed said they expect to use digital payments more in the coming year.

Among the factors driving consumers to adopt cashless technology are the
convenience and speed they offer as well as the ability to track expenses, Mundy
said in the statement. While small and micro-businesses want to integrate new
payment forms into their operations, they may face hurdles such as cost, lack of
training and security concerns, Mundy added. 

Although nearly half (49%) of consumers told Visa they planned to shop more
locally, 72% of shoppers are comfortable shopping with international merchants,
the card network reported.

Visa’s latest survey builds upon previous research indicating that small
businesses are counting on digital payment acceptance to further growth. The
card giant released a survey last year showing that 82% of small and
micro-businesses planned to accept digital payment options that year.

Other research has illustrated the decline of cash and the ancillary impact of
dwindling cash use. 

A Gallup survey released last year found that 13% of respondents use cash for
all or most of their purchases, down from 28% five years earlier. Plus, June
data from Euromonitor International indicated ATMs declined to 451,500 last year
from 470,000 in 2019.

Though business owners want to transition to cashless, legislators are weighing
whether to prevent them from doing so. In June, Congress members introduced
bills in the House and Senate to prohibit businesses from refusing to accept
cash for in-person transactions.

The legislation is meant to prevent discrimination against unbanked and
underbanked Americans who rely on cash to pay for their essentials, according to
bill authors Representatives Donald Payne Jr. (D-N.J.) and John Rose (R-Tenn.)
and Senators Bob Menendez (D-N.J.) and Kevin Cramer (R-N.D.). 

Meanwhile, local government officials are having a similar debate. In Atlanta,
for example, Atlanta City Council members met Wednesday to discuss a proposal
that would require retail businesses to accept cash payments, The Atlanta
Journal-Constitution reported.

Article top image credit: Creative via Getty Images



AMAZON PROPOSES LESS PACKAGING, MORE SAVINGS FOR ITS SELLERS

Testing for Ships in Product Packaging compatibility often involves “a series of
drops and vibrations.” Sellers can expect fee discounts for participating in the
newly expanded program.

By: Katie Pyzyk • Published Feb. 22, 2024

Amazon is pulling back the curtain on how it’s teeing up more packages to arrive
on doorsteps without Amazon logos. Last week, the Ships in Product Packaging
program expanded by opening participation to hundreds of thousands of sellers in
the U.S. and Canada that use Fulfillment by Amazon. 

Amazon itself had already been increasing the amount of items it ships without
additional Amazon packaging, and the e-commerce giant announced last year that
sellers would be able to join its SIPP program in 2024.

It ran a pilot program with a small group of selling partners in 2023 to learn
what information sellers needed to fully understand SIPP and enroll a product.
The pilot “helped us develop what is a really scalable way to provide
information to sellers,” said Kayla Fenton, senior manager of packaging
innovation at Amazon.

Sellers are a diverse group, Fenton said: “They have a range of interests in
what’s important to them — whether that be fee incentives or customer experience
or sustainability — but they also have a range of experience, especially as it
relates to packaging.”


LESS PACKAGING, MORE SAVINGS

The SIPP push is one of Amazon’s recent packaging changes to improve company
sustainability. Amazon announced last year that it would phase out plastic
mailers, and it upgraded the technology at a fulfillment center in Ohio to make
it the company’s first to handle fiber packaging alone — no plastic. Amazon is
working to lightweight its packaging and ultimately “eliminate packaging
altogether.”

Sellers who enroll in the SIPP program will receive discounts. Savings will be
based on the existing FBA fee tiers — which primarily consider package size and
weight — but generally they will range from 4 cents to $1.32 per unit. Even if a
consumer specifically opts in during checkout to add Amazon packaging for
shipment, a seller participating in SIPP will still receive their discount,
Fenton said.

The level of incentives vary because “if you’re avoiding adding a very large
overbox to a product like a ... kitchen appliance, that’s different both for the
seller and for Amazon than if you’re avoiding an additional package for a
T-shirt that might be pretty small and also be shipping in a pretty compact
package today,” she said.

Amazon previously reported that it shipped 11% of products in their own
packaging in 2022. The company isn’t releasing an expectation for how that
figure could grow in light of the expansion, or how many sellers currently
participate in SIPP. But it’s “certainly anticipating that it increases over
time,” and the company is eagerly watching this year’s adoption rate, Fenton
said.


WHICH PRODUCTS MAKE THE CUT?

While Amazon currently has about 2 million independent sellers worldwide, for
now SIPP only is being offered for those in the U.S. or Canada, and they must be
part of Fulfillment by Amazon, in which Amazon takes care of packaging for a
seller’s products.

Sellers also must ensure their products meet eligibility criteria to ship
without additional packaging. Size is the biggest determinant: Amazon won’t ship
small products in their own packaging for numerous reasons, including the
inability to put labels on them.

Other determining factors for SIPP approval include product weight or
sensitivity factors. Amazon says all criteria are clarified to sellers in an
online hub, Seller Central.

“At the end of the day, our first goal is to make sure that the product arrives
to customers undamaged,” Fenton said. “Meeting the testing requirements is the
last piece of the puzzle for a product to be enrolled.”


Amazon performs a variety of tests on products to determine their suitability
for SIPP. Its main packaging innovation and testing facility is in Sumner,
Washington.
Permission granted by Amazon
 

Products can be tested in a variety of ways, and Amazon receives the final
report. Following testing, Amazon can certify a product as eligible for SIPP or
recommend changes to meet program criteria.

“One seller might have to make a very minor change in order to meet our
eligibility criteria. Other sellers might have to sort of think about their
packaging in a bigger way and maybe sort of change the format altogether to meet
standards,” Fenton said.

Some of the work to certify sellers’ products for SIPP lies inside Amazon’s
Packaging Innovation Lab in Sumner, Washington. That’s the primary site for
packaging innovation and testing, although some work also occurs in other
locations, including third-party labs.

“Every one of these interactions with the selling partner, on the other end is
one of our lab technicians. So [the sellers] are talking to people that actually
know about packaging and have seen, in some cases, thousands of different items
get tested,” said Josh Samples, senior manager on the packaging innovation team.
“We try to give specific answers that can help them get to their
certifications.”

He explained that working with such a wide variety of sellers, from big
companies to mom-and-pop businesses, results in Amazon gathering scores of
information from which technicians can develop customized recommendations,
rather than employing a one-size-fits-all approach. The team looks for ways to
improve the seller experience and speed up the SIPP onboarding process, such as
by recommending that fewer items are tested if they can be grouped together for
certification.

“We’ve had instances [where] a seller submits a bunch of different tests and
test reports, when we can say, ‘Hey, actually, these are all really similar. You
don’t need to test every different color of a T-shirt,’” Samples said. That
being said, the lab does not compare one seller’s products to another seller’s.
“We wouldn’t want to make inferences and say, ‘You know, what we’ve learned from
Seller B is that T-shirts do this, and so you don’t want to do it.’ We kind of
assume for every single seller they’re unique,” he said.


SIPP SPURS CREATIVE PACKAGING FORMATS

One example of working with a customer on a SIPP-ready product is Amazon’s
partnership with Procter & Gamble on Tide detergent packaging. The partners
decided to convert the liquid-holding plastic jugs to a bag-in-box design so the
product could ship in its own packaging. Compared with the jugs, the revamped
packaging also includes 60% less plastic and is four pounds lighter.


Amazon worked with Procter & Gamble to develop a bag-in-box package for liquid
Tide detergent that allows it to ship without additional packaging.
Permission granted by Amazon
 

Despite potential efficiency benefits from grouping similar items, Amazon does
more robust testing for certain products, such as fragile items. “We try to find
ways to use our capacities in the lab to help get those items [certified] and
make sure that we put a real scrutinous eye on them,” Samples said.

Testing at the lab typically involves “a series of drops and vibrations,” but
the methods and machines used are determined by product type, he explained. 

“We might, for example, want to understand how a large palletized item would
perform when a truck comes to a screeching halt. That’s not something we’re
going to think about for a T-shirt,” Samples said.

This year and beyond, Amazon aims to continuously improve the seller enrollment
process for SIPP, although sources wouldn’t provide details on specific steps. 

“We’re changing our fulfillment network every day ... using science and data to
try to understand — as Amazon is building out this network and it’s evolving,
what should that mean about our test methods?” Samples said. “If you were to
come back and ask that question three years from now, we might have totally
different test methods.”

Article top image credit: Permission granted by Amazon


MICHAELS PROMOTES ONLINE MAKERPLACE WITH ‘RESPECT THE HANDMADE’

A new brand campaign and an in-store pilot of the marketplace further
position the company as an alternative to Etsy.

By: Jessica Deyo • Published March 11, 2024

Michaels launched a campaign, “Respect the Handmade,” in support of the recent
debut of MakerPlace by Michaels, its new online marketplace that features
handmade items, classes and how-tos, according to a press release.

Central to the effort is a 30-second spot showcasing a slew of handmade goods
coming to life, set to a playful cover of the classic song “Respect.” The
campaign spans social media, the MakerPlace website, Michaels-owned channels,
streaming video and programmatic paid media. 

Michaels is also supporting MakerPlace, which launched in November, via an
in-store pilot program, inviting makers to sell directly to their community at
their local Michaels store. The retailer’s latest marketing move signals how it
is attempting to stay competitive against platforms like Etsy. 

Michaels is putting marketing muscle behind its recently launched MakerPlace
through the online shop’s first-ever campaign. “Respect the Handmade” could help
the brand gain share against digital competitors like Etsy and loyalty from the
growing number of consumers who prefer shopping from small or local businesses.

Messaging behind “Respect the Handmade” is meant to celebrate Michaels’ ongoing
support of independent artists and the customers who buy their products. At the
center of the campaign is a 30-second spot, which features items like a bag,
earrings and flower pots coming to life to take part in a playful cover of
“Respect,” the hit song originally by Otis Redding. 





Michaels additionally is using its brick-and-mortar presence to test another way
for handmade artists to sell their items at their local Michaels store via an
in-store pilot program. The brick-and-mortar element is part of the brand’s
“test and learn” strategy, a data-driven approach to launching small-scale,
in-market experiments that inform future launches, per release details. The
first in-store pilot began Feb. 24 in seven stores across the U.S. and the next
pilot will begin March 23. 

The Michaels MakerPlace was created to support handmade artists by offering
multiple membership options, lower fees and more ways to earn, whether through
selling items, hosting live classes or sharing how-tos with commission-earning
supplies lists. Michaels, headquartered in Irving, Texas, currently operates
around 1,300 stores in 49 states and Canada.

The first campaign for MakerPlace by Michaels follows a brand refresh by the
retailer last year that introduced the tagline “Everything to Create Anything,”
positioning the company as a creative partner. Michaels has made additional
efforts to support sellers, including through the creation of a dedicated online
marketplace for third-party sellers.

The creative push from Michaels also comes as competitor Etsy steps up its own
marketing, with the e-commerce company recently making its Super Bowl debut to
highlight a new gifting hub. Pinterest, also regarded as an online destination
for creative inspiration, has similarly ramped up marketing recently to showcase
how people use its platform to discover and experience new opportunities, places
and ideas.

Article top image credit: Courtesy of Michaels



GOOGLE ANNOUNCE NEW FEATURES FOR SMALL BUSINESSES AHEAD OF HOLIDAY SEASON

Merchants can identify themselves with a new small business attribute on Search
and Google Maps to make it easier for shoppers to narrow their searches.

By: Xanayra Marin-Lopez • Published Nov. 6, 2023

Google announced last week new features for merchants to help them show up more
easily in search and on Google Maps this holiday season, according to a company
blog post.

U.S. businesses on its Merchant Center platform can now add a small business
attribute in which a small icon along with a written label describing the
business is displayed on the listing. The labels will make it easier for
shoppers to narrow their searches, according to the post. 

Google is also updating its knowledge panel in select countries to show
additional information on businesses such as current deals, shipping and return
policies, and ratings and reviews.

According to Google’s buyer’s remorse survey, 84% of people say supporting local
and/or small businesses is important to them, so Google is leaning in and making
it easier for small and minority-owned businesses to get noticed.

Small merchants using Merchant Center or Business Profile in the U.S., including
those using the Google and YouTube apps on Shopify, can add the attribute to
their account, according to the post.

Google will automatically add the small business attribute to some merchants’
listings based on the number of products offered, the number of locations or how
much web traffic the business gets. Users can remove it at any time. Google is
also partnering with Etsy to include eligible sellers. 

Additionally, merchants will be able to create and manage product images using
its new AI-powered Product Studio. For the studio, the set of AI tools can be
used to set experimental scenes for products using a text-to-image generative AI
model to place products in various backdrops such as holiday-themed scenes.

Google is also adding new details to the knowledge panel, in order to help build
trust with unfamiliar businesses.

“Shoppers can be hesitant to buy from businesses they haven’t heard of. But
certain key information, like other shoppers’ experiences, can help them build
confidence to try something new,” the company said in the blog post. “To help
build trust with unfamiliar businesses, we’re expanding the type of information
shoppers see when they look for businesses on Search.”

This is not Google’s first AI-powered project this year. In January, Google
rolled out artificial intelligence-driven tech allowing retailers to use imagery
to track items on store shelves. In June, the company used AI for its virtual
try-on tool.

Article top image credit: Courtesy of Google


MORE HOLIDAY SHOPPERS TO BUY WITH SMALL BUSINESSES: SURVEY

Interest in buying gifts in-store is higher at independent businesses than at
some large retailers like Macy’s and Best Buy, according to a report.

By: Tatiana Walk-Morris • Published Dec. 6, 2023

The percentage of consumers shopping for holiday gifts with small and local
businesses as much as possible has grown from 10% a year ago to 20% this year,
according to a Jungle Scout survey. 

For large online retailers, Amazon ranks first as the most popular at 67%,
followed by Walmart (36%), Target (14%), eBay (13%) and Etsy (11%). Among the
top in-store holiday shopping destinations are Walmart (55%); Target
(22%); Kohl’s (14%); specialty, independent, boutique and local retailers
(12%); and Costco (9%), per the report of 1,000 U.S. consumers ages 18 to over
75. 

Eighty-five percent of consumers report that their spending has been impacted by
inflation in Q4 of this year. While 89% of Gen X shoppers said inflation has
impacted their budgets, 87% of millennials, 84% of baby boomers and 74% of Gen Z
consumers said the same. 

More consumers are interested in shopping with small and local businesses for
gifts, surpassing interest in some major retailers, according to Jungle Scout’s
report. Though specialty, local, independent and boutique retailers ranked 4th
among the most popular in-store destinations, they came before Costco,
Walgreens, Best Buy, Sam’s Club, Macy’s and Home Depot, which took the fifth
through tenth spots. 

Other consumer research has also noted the rising popularity of local and small
businesses. The total spending of U.S. consumers who shopped at independent
retailers and restaurants on Small Business Saturday this year reached an
estimated $17 billion. The American Express 2023 Saturday Consumer Insights
survey additionally found that more than half (53%) of respondents reported
shopping online at small businesses on Small Business Saturday, a greater share
than the 34% who shopped online at large retailers that day.

Another recent survey from YouGov and Bankrate found that 72% of consumers said
they plan to shop with small businesses online or in person over the holidays,
up from 65% in 2022.

Jungle Scout’s report adds to previous research indicating that inflation is
weighing on consumers’ budgets. Though only 19% of consumers said they increased
spending in the fourth quarter, 45% said they spent the same amount compared to
the previous quarter, and the remaining consumers said they have decreased their
budget. Looking ahead to 2024, 73% of consumers said they plan to re-evaluate
their spending and budget next year.

Article top image credit: Creative via Getty Images


IN CHALLENGE TO ETSY, ARTISANS COOPERATIVE MARKETPLACE LAUNCHES

The platform, which focuses on selling handmade goods, was formed as a result of
the Etsy strike last year over seller fee hikes.

By: Tatiana Walk-Morris • Published Oct. 5, 2023

Following the Etsy strike last year, Artisans Cooperative, a collective
representing crafters, has beta launched an online marketplace for handmade
items owned and operated by its users, according to a Monday press release
shared with Retail Dive. 

On its first day, the platform had more than 70 merchants and 1,200 items
available for consumers. The site was built using Shopify, according to the
announcement. 

The marketplace’s policies are written by the community and it charges a sales
commission, but does not charge seller listing fees. It also provides customers
and artisans the chance to become co-op owners with voting rights and financial
rights.

The Artisans Cooperative emerged following the 2022 Etsy strike, in which
crafters on the platform spoke out against Etsy’s business practices. Etsy
raised sellers’ transaction fees, a move it said it made to “invest in more ways
that benefit our sellers.” Aside from the fee increase, Etsy has also caught
criticism from some sellers who say it caters more to mass merchants and
resellers than it does to small crafters. 

“We are excited to provide a platform that rewards the artisans and their craft
as the true value builders of a marketplace,” Erin Sapre, a potter in North
Carolina and secretary of Artisans Cooperative, said in a statement. 

The launch of the Etsy alternative comes as Etsy has seen a slowdown this year.
In Q1 2023, the company reported that its marketplace gross merchandise sales
declined 4.7% from last year to $2.7 billion, and its net income decreased $11.6
million from last year to $74.5 million. However, its consolidated revenue rose
10.6% year over year to $640.9 million, which the company said was due to the
increase of its marketplace transaction fee.

A similar pattern continued in its second quarter this year, with gross
merchandise sales down 0.7% year over year and net income sliding $11.2 million
from last year to $61.9 million. The company’s consolidated revenue, on the
other hand, saw a 7.5% bump in Q2 2023, per its quarterly earnings report. 

Still, Etsy also noted that its active buyers grew in the first and second
quarters by 1% and 3% year over year, respectively. As of the second quarter,
the company had a record 96 million buyers and more than 8 million sellers on
its platform. 

Article top image credit: Permission granted by Walnut Studiolo




THE STATE OF SMALL BUSINESS IN RETAIL

The pandemic has impacted the trajectory of small businesses, particularly
squeezing stores that were deemed non-essential during periods of required
closures. Now independent retailers have started to experiment with solutions
that used to only be available to mass marketers or large national chains.

INCLUDED IN THIS TRENDLINE

 * Temu and Shein can weather de minimis changes. Others may struggle.
 * Tupperware shutters only US manufacturing facility
 * What 8 DTC brands are talking about in 2024

Our Trendlines go deep on the biggest trends. These special reports, produced by
our team of award-winning journalists, help business leaders understand how
their industries are changing.
Davide Savenije Editor-in-Chief at Industry Dive.