Still room for growth in e-commerce
New research on the state of the UK SME retail market, from Brick technology Limited, indicates that doing business online has become more profitable and less costly to implement, but that few retailers are grasping the opportunity According to Brick technology's annual marketing analysis report,
90% of company web sites are profitable; and on average, companies that implement ecommerce find it costs 40% less than they anticipated
Competitive web design market. Average value of ecommerce sites built remains at around GBP26,000 per design company for the year. But only one in six retailers have an e-commerce web site.
Even amongst those who already accept telephone orders for home delivery, only one in three have an ecommerce facility.
"Online stores are rarely unprofitable, because there is huge growth in the sector and overheads are far lower than their offline competitors,"
"Given the ease with which you can set up a web store nowadays, there is no reason not to take the plunge - especially if you already offer home delivery".
This survey was undertaken using a sample of around 600 randomly-selected small and medium-sized retailers, of whom 146 had web sites.
It found that the number of retailers with ecommerce sites had risen by over 30%, from 8% of companies in 2005 to 11% in 2006 to 20% in 2007 - confirming trends reported by bodies such as the IMRG.
Highlights from the Survey:
- The proportion of retail companies using ecommerce rose from 8% in 2005 to 11% in 2006 to 20% in 2007.
- But 65% of retailers who accept mail and telephone order still do not have an ecommerce facility.
- 90% of companies with an ecommerce facility said their web site was profitable.
- On average, companies paid 40% less than expected for their ecommerce solution.
- 45% of companies built their own ecommerce sites.
Of the remainder, 85% used a web design company such as Brickweb.
Very few used other third parties such as consultants or IT resellers.
- 0% of retailers think that online shoppers are lazy.
The primary advantage of internet shopping is perceived to be not price, but convenience - named by 75% of retailers as the main reason why customers shop online.