Lack of Payments Integration Hampers Growth at Small UK eCommerce Sites

Serving online customers in multiple countries and across regions can be a complex tech undertaking for any firm, especially for small- to medium-sized businesses (SMBs) with limited human resources.

This is a huge challenge in the United Kingdom in particular, where SMBs trail their European counterparts on integrating third-party software and capabilities into their eCommerce technology stack, according to a research study conducted by Amsterdam-based FinTech firm Mollie.

For British SMBs looking to expand into new markets across Europe, accepting the preferred local payment methods that do not exist in the U.K. market — iDEAL in the Netherlands, Sofort in Germany and Bancontact in Belgium, for example — is also critical if these businesses are to successfully expand beyond the U.K.

Read Mollie CEO Interview: Mollie Looks to Improve Marketplace Product With a Financial Services Suite for European SMBs

It’s a setback that makes European expansion challenging, Mollie’s U.K. Country Manager Josh Guthrie told PYMNTS, and one that gives global eCommerce giants a competitive edge over these smaller local firms.

As a result, the FinTech unicorn firm, which launched in the U.K. last year, is helping local companies transform their eCommerce business and improve their payment processes, offering SMB clients seamless, affordable payment integrations using an application programming interface (API).

See also: Amsterdam Payments Firm Mollie Notches $800M Led By Blackstone

One of Mollie’s clients, Sheffield-based traditional scissors manufacturer Ernest Wright, has benefited from Mollie’s broad range of payment methods, allowing them to seamlessly accept payments from customers in over 80 countries around the world.

“They’re able to access those at a fraction of the cost on a monthly basis [and] easily integrate them into existing technology stacks. That allows them to either improve and automate business processes or tailor their services or payment methods to customers’ [needs],” Guthrie explained.

A Much-Needed Human Touch

According to Guthrie, findings from Mollie’s research study also revealed that only 5% of merchants reported having no frustration with their payment provider. Over 50% were frustrated by slow response times, clearly indicating an important need for high-quality support and customer service that has been lacking in the U.K. SMB space.

Read more: Dutch FinTech Mollie Launches SaaS Payment Platform

It’s a service that Mollie offers today and seems to be much appreciated by Paul Jacobs, co-owner of Ernest Wright.

“I like [doing business] online, but it is much easier to speak to someone and just say, ‘This is what we want,’ and then from there it’s very easy to do it online,” Jacobs explained, adding that it adds a much-needed personal human touch to the entire process.

Given the rapidly evolving payment space and the emergence of new payment methods such as open banking and cryptocurrencies, Jacobs added that partnering with a business-to-business (B2B) company like Mollie that keeps up with changing technology trends eases his company’s concerns around keeping up with innovation.

“I don’t know where [the payments sector] will go from here, so it’s easy for us to partner with a company that is taking care of that part. [That way] I don’t have to think about it,” Jacobs remarked.

Stockpiling for a Rainy Day

Moving forward, the 120-year-old U.K. SMB, globally recognized for its heirloom-quality, hand-made scissors and shears, is training the next generation of master craftsmen to keep the craft alive.

However, macroeconomic events like the ongoing war in Ukraine has led to high steel and energy prices, Jacobs said, while Brexit has made it difficult to import materials like Italian cotton fabric, used for polishing, into the U.K. Those issues, worsened by the pandemic, are some of the key challenges that they will be looking to tackle going forward.

“[Brexit] makes it very complicated to send our products directly to the end user in Europe, so now we have to adopt a two-step process; we sell it first to our own sister company [in the Netherlands] before sending it to the U.K. You have to adapt to the changing rules all the time,” Jacobs explained.

Another way the SMB firm is overcoming these hurdles is to stockpile on essential materials.

“We’ve already bought enough metal to sustain us for the next three years. Same for cotton, because it goes up every three months,” he said. “If you don’t anticipate [these supply chain issues], which not all the suppliers do, you can end up going out of business.”

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