Traditionally, e-commerce was a way for physical businesses to expand their reach and sell to customers outside of their local area. In 2025, that has evolved massively with the majority of online retailers being completely operated without physical stores that customers can visit.

Operating an ecommerce store is a leaner model than brick and mortar for sure, but it’s still costly to scale. Housing stock requires a secure warehouse, staff to coordinate picking, packing and shipping and management staff to oversee the operation.

It’s for this reason that many small ecommerce retailers hit a ceiling that they find hard to break out of. In order to scale to the desired medium to large size business requires a lot of capital, which can be hard to come by for cash strapped operations.

Thankfully there are now several solutions out there to help break through this bottleneck, which will be discussed in this article.

Use 3^rd Party Logistics

3^rd party fulfilment also known as 3PL fulfilment is a really simple and cost effective way to scale operations without having to invest heavily in premises and staff. Many businesses use it as a bridging strategy to test out expansion before scaling up their own operation. However, for many it is a long-term solution to make that leap from small to medium, or medium to large.

What is it exactly? It’s a managed service that houses your stock, picks your orders, packs them and sends them on your behalf for a fee. Obviously in the long-run it is a more expensive option than building or renting a warehouse, hiring additional staff and expanding internally. However, that’s a huge cost and gamble when you don’t know if it’s going to work out.

This makes using 3PL a smart choice for many business owners, because it allows you to expand in the quickest time possible without any huge upfront outlays.

Bank Financing

Bank financing (loans) are not the same as they used to be. It used to be the case that if you have a good relationship with your bank manager you could make your case for financing.

Nowadays it’s more of a computerized decision, where your company’s cold hard financials give you a yes or no answer. If you’ve been established for a long time, have a healthy bank balance and trading history they this isn’t a problem. But if you’re a fast growing young company then you’ll be held back by the constraints of the modern banking system.

However, if you’re able to then bank financing is a great way to get the cash to expand your operation without risking cashflow or giving up a % of your company ownership.

Raise Funds from Investors

If you are in a position of strong growth, but are too young a company to be given loans from your bank then the alternative is to raise funds from investors.

If your company is showing strong potential then many institutional and private investors will likely take an interest in participating in an investment round.

This is especially true when there is a clear objective for the raise, in this case expanding the warehousing and staffing.

However, it comes at a cost, reducing your ownership stake in your business, and it can also be pretty complex and costly to raise the funds and find investors. The legal fees alone are always significant, so it’s for this reason that this route is usually only followed when raising significant amounts.