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E-commerce under-utilised by retailers

E-commerce under-utilised by retailers

Trading online has become more profitable and less costly to implement, but few UK SME retailers are grasping the opportunity.

Those are the findings from e-commerce software specialist Actinic

According to the latest annual survey from e-commerce software specialist Actinic, 90 per cent of company web sites are profitable.

On average, companies that implement e-commerce find it costs 40 per cent less than they anticipated. But only one in ten retailers has a transactional web site.

Even amongst those who already accept telephone orders for home delivery, only one in four have an e-commerce facility.

Actinic CEO Chris Barling comments, “Online stores are rarely unprofitable, because there is huge growth in the sector and overheads are far lower than their offline counterparts.

“More consumers are letting their fingers do the shopping, but still too few smaller businesses are grasping the opportunity.”

In its sixth year, Actinic’s survey was undertaken by pfa Research on 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 e-commerce sites had risen by over 30 per cent, from 8 per cent of companies in 2005 to 11 per cent in 2006 - confirming trends reported by bodies such as the IMRG.

Highlights from the 2006 Actinic survey include:

-       The proportion of retail companies using e-commerce rose from 8 per cent in 2005 to 11 per cent in 2006.

-       But 75 per cent of retailers who accept mail and telephone order still do not have an e-commerce facility.

-       90 per cent of companies with an e-commerce facility said their web site was profitable - up from 70 per cent in 2005.

-       On average, companies paid 40 per cent less than expected for their e-commerce solution. The average anticipated cost was £2,416, whereas the average price paid was only £1,585.

-       45 per cent of companies built their own e-commerce sites. Of the remainder, 85 per cent used a web designer. Very few used other third parties such as consultants or IT resellers.

-       10 per cent 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 per cent of retailers as the main reason why customers shop online

The full report is available free from

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