The number of online-only e-retailers in the UK more than doubled in the last five years from6,700 businesses in 2008 to 14,400 in 2012, according to a nationwide study commissioned by Royal
Mail.The explosion of e-retail businesses has resulted in around 15,000 new jobs created bye-retailing start-ups between 2008 and 2012 which equals a 25% increase with the total number ofpeople employed in the sector reaching 72,000 last year.
Royal Mail’s new research conducted by the Centre for Economics and Business Research (CEBR)revealed that entrepreneurs prefer to invest in companies trading online as they seek to createsuccessful businesses.
While online-only retailers generated average annual growth of 21.3%, the total number ofbusinesses contributing to the UK economy is dropping 0.4% each year, the study showed. Over thepast five years, the total number of retail businesses fell by 0.1% a year on average.
In 2012, the online-only e-retail sector made a £2.2 billion gross value added (GVA)contribution to the UK economy, up 4.7% in nominal terms on the previous year. This compared to a1.2% year-on-year increase for the retail sector as a whole and 1.6% increase for the UK economy intotal, the CEBR study of ONS (Office for National Statistics) data revealed. Sales in online-onlye-retailing increased by almost 50% between 2008 and 2012 compared to only 13.6% growth in thetotal retail sector.
As the UK’s Universal Service Provider, Royal Mail stressed it is well positioned to benefitfrom the rapidly growing parcels market in the UK with its strong brand, extensive network and highquality of service.
The British postal operator added that the expanding parcels market remains in the focus of itsgrowth strategy with the parcels business already accounting for nearly half of the Group’srevenues. “We are targeting growth across all four of our parcels networks: our core Royal Mailnetwork which handles the vast majority of parcels we carry, our express delivery serviceParcelforce Worldwide, our Royal Mail Specialist Services network and GLS, our European parcelsnetwork,” the company concluded.
Nick Landon, Managing Director Royal Mail Parcels, said: “Online-only e-retailing has become anincreasingly strong area for business start-ups and is making a strong contribution to overall UKeconomy. With continued growth in online shopping, we can expect more significant contributions tothe UK economy in the coming years.”
