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Online retailer numbers in UK have doubled in five years

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A nationwide study of online-only retailers shows the number of such businesses in the UK has more than doubled in the past five years from 6,700 in 2008 to 14,400 in 2012.

The study, commissioned by Royal Mail, estimates that around 15,000 new jobs have been created by eretailing start-ups that trade solely online in that period – and that 72,000 people are now employed in the online-only eretailing sector. The research also shows that entrepreneurs are choosing to invest in companies that sell goods online as they seek to create successful businesses The 21.3% average annual growth in companies who sell goods exclusively online compares with a 0.4 per cent average fall each year in the total number of businesses contributing to the UK economy, the study, by the Centre for Economics and Business Research, found. Over this period, the total number of retail businesses fell by 0.1 per cent a year on average.The CEBR study of ONS data revealed that sales in online-only retailing grew by almost 50% between 2008 and 2012. Over the same period, growth in the total retail sector was only 13.6%.

The online-only retail sector also made a £2.2bn gross value added (GVA) contribution to the UK economy in 2012 – up 4.7% in nominal terms on the previous year. This compared to a 1.2% year-on-year increase for the retail sector as a whole and a 1.6% increase for the UK economy in total.

Nick Landon, managing director of Royal Mail Parcels, said: “Online-only eretailing has become an increasingly strong area for business start-ups and is making a strong contribution to the overall UK economy.”

The findings chime with a recent study by Barclays that found UK online businesses are growing more than 50 times faster than the economy as a whole. The research by Barclays’ technology, media and telecoms industry team found the average online company saw 11.4% compound annual growth over the last three years, with half of those questioned enjoying double digit growth over that time. The UK economy as a whole grew at 0.2% in that time, making the online sector’s growth rate 57 times faster.


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