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SME online retailers predict bumper 2013

Just over half of SME online retailers saw an increase in sales last year

UK online retailers are predicting improved sales in 2013 despite a more competitive environment for a share of consumer spending, research by the Royal Mail has shown.

The study revealed that just over half of SME online retailers saw an increase in sales in 2012, while 64% are "confident" sales will increase this year.

This is despite 70% believing competition is "more intense" than two years ago, although the Royal Mail pointed out the overall market was bigger.

The rise in people using smartphones and tablets to buy goods increasingly means shoppers are using retailers they know and not shopping around, 31% of online retailers said.

To respond to the challenge of the changing ways people shop online, 35% of SME online retailers are planning to develop mobile apps in 2013 - 10% said they have already developed them.

Some 48% said they will be increasing customer satisfaction by improving the range of products available, and 46% said they will be pricing them more competitively.

Furthermore, 29% will be improving the quality of products they sell, and one quarter will focus on improved delivery and returns processes.

Before Christmas it was estimated UK retailers could lose an estimated £147 million of revenue due to missed sales opportunities through out-of-stock products, and an additional £1.7 billion to their competitors as consumers moved to other websites for their Christmas gifts.

Research commissioned by NetSuite found that across 100 UK retail IT managers and 2,000 UK consumers, the average retailer was losing 10% of their Christmas revenue through out-of-stock situations. Ageing IT systems were partly blamed.

Managing director of Royal Mail Parcels Nick Landon said: "Our study shows that online retailers are responding to the needs of shoppers to grow sales in an increasingly competitive marketplace."

The Royal Mail study was conducted by research company Brass among 441 UK SME online retailers.


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