Now you need to figure out your organizational and team structures. Don't underestimate the value of planning everything out ahead of time, so you can hit the ground running. You'll also need to include this information in an eCommerce business plan.
Keep reading to learn about the different eCommerce company organizational structures, facilities you need, and the team structures available to you.
eCommerce Company Organization Structure
Though there are many types of eCommerce businesses, the organizational structure tends to fall within one of four types. The main difference between them is the division of labor and responsibility. However, it's valuable to know that you don't have to stick to just one and can build your structure however works best for you.
Here are the most common types of eCommerce company organization structures:
- Functional structure. Also called a bureaucratic organizational structure, the functional structure is simple and easy to implement. It involves breaking the company up by specialization and establishing leadership for each group. The primary benefit to this approach is that it's easy to understand and each department has a leader to assist in operations and be held accountable when the need arises.
- Divisional structure. Very common among big businesses, the divisional structure separates an organization into operational divisions. What separates this from the functional structure is that each division acts as its own separate entity. This means that you essentially run multiple businesses each with its own leadership. It's valuable when a business is very large or complex, but most small to mid-sized eCommerce businesses won't benefit from this model.
- Flatarchy structure. A newer structure common among startups, the flatarchy structure is designed to lessen hierarchy and empower the employees. Essentially, it cuts out the bureaucracy by eliminating department heads and letting each employee own their work. It's a great choice for businesses that need flexibility and speed. If you run a dropshipping business or just have a small team, this is a good choice.
- Matrix structure. The final structure is the matrix structure, and it's the most complex of the bunch. Rather than having a defined vertical hierarchy, employees across different departments report to multiple supervisors. This is common among sales and customer service departments, but can easily become difficult to keep streamlined.
eCommerce Operational Needs
All of these business structures rely on the same operational needs when it comes to facilities, processes, and teams. For facilities and equipment, you need a computer, internet services, mobile phone, credit card, and an account with one of the best banks. You'll also need to make sure you invest in eCommerce software, including a payment gateway and eCommerce merchant account to make your life easier. Processes and teams should be streamlined for maximum efficiency and to ensure you don't waste any of your budget.
The biggest benefit of choosing the eCommerce business model over the traditional one is that you can limit overhead costs. You can increase sales and maximize profits with a smaller team, let 3PL companies handle fulfillment, and sell online through an eCommerce marketplace without ever having to leave your room.
eCommerce Team Structure
Team structures and business structures are not the same things. Whether you choose a functional, divisional, or other organizational structure, you also need to determine how each team will be structured and it doesn't have to be the same as the overall structure. For most eCommerce teams, a simple hierarchical structure is easiest at least in the early days. You can hire a single team or department lead who all employees report to. This makes it easy to scale and you can shift to another dynamic as you grow.
Mid-sized eCommerce businesses will likely add middle managers to help lessen the responsibility on upper management and further separate the departments. This means you'll need a structure in place when hiring an eCommerce manager, order management specialist, inventory control manager, and more.
Quiz: List Three Facilities Needed For The Operation Of eCommerce
Were you paying attention to how eCommerce structures work? Let's find out with a quick quiz.
List three facilities needed for the operation of eCommerce:
A. Storefront, computer, warehouse
B. Computer, bank account, internet
C. Bank account, warehouse, storefront
D. Office space, computer, fulfillment center
E. Computer, storefront, bank account
If you chose B, you’re correct. You can start and grow an eCommerce business with just a computer, bank account, and internet access. Nice work!
Frequently Asked Questions About eCommerce Organizational Structure
The eCommerce industry continues to grow at a rapid pace each year, so new business owners are looking at the model every day. This also means that there are a lot of questions.
To help you make the most of the eCommerce growth trends, here are the most frequently asked questions about eCommerce organizational structure.
What Are The Departments In E-Commerce Companies?
The most common departments in eCommerce companies are marketing, customer service, inventory management, and upper management. When you're starting out, you may only have one of the departments, but each will be needed as you grow.
How Do You Structure An Ecommerce Team?
Structuring an eCommerce team relies on balancing cost-effectiveness with growth goals. We recommend performing a series of forecasts and business evaluations to set firm growth goals before you create any job openings. This will allow you to focus only on the most important roles and seek out people who are a good fit.
Which Department Is Responsible For Ecommerce?
If a brick-and-mortar business enters the eCommerce sphere, they will most likely assign all eCommerce duties to the marketing team. They will be expected to help facilitate the O2O shift, list products online, create digital advertisements, implement eCommerce SEO, and more.
Incorporate This Structure Into Your Life
How you structure your business and internal teams play a major role in your ability to scale with ease. If you make your business too complicated at the start, you'll have to take the time to fix it later and miss out on some revenue. Take the time to research and evaluate your needs.
If you're looking to start an eCommerce food wholesale business, BlueCart is the best tool for you. It's an all-in-one online marketplace that helps businesses make wholesale sales, acquire new customers, and grow their bottom line.
We also recommend checking out some of the best eCommerce books, best eCommerce websites, and eCommerce blog or two to give you insight into some of the new technologies and trends you can use to grow. You should also check out our full eCommerce business guide for more tips on sustainable growth.