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Overseas online sales to generate £28bn for British retailers by 2020 Tuesday, 30th April 2013
Online sales generated by UK retailers from international markets are expected to generate £28 billion by 2020, according to new research released on Tuesday.
The report, by OC&C Strategy Consultants in collaboration with Google, predicts that international online sales will soon outpace domestic ones to make up 40 per cent of total online sales by 2020.
Sales in Western Europe are expected to grow to £9.8 billion in 2020, from £1.5 billion in 2012. The Britain’s Retail e-mpire report found these markets offer favourable trading conditions as a result of low barriers to entry through the EU, along with the relatively well developed infrastructure between nations on the continent. Meanwhile the emerging economies of Central and Eastern Europe and Asia are slated to continue to expand, with sales predicted to reach £6.9 billion by 2020m up from £400 million in 2012, and £4.5 billion by 2020, up from £400 million in 2012 respectively.
The report found North America will continue to lead the way as the single biggest regional market for British online goods, with sales set to rise from £0.8 billion in 2012 to £2.7 billion in 2020. However, OC&C pointed out that the growth rate is predicted to slow down over time due to the maturity of the market and increased competition from established national brands.
Working with Google, the study found the number of consumers from outside the UK searching online for British brands and retailers is growing by an average of 46 per cent a year since 2010. British brands including Asos, Burberry, Net-a-Porter, Topshop and Wiggle reportedly receive over half of their traffic from overseas, a trend also seen with small and mid-sized retailers in the UK, who receive 47 per cent of their online searches from overseas.
Speaking in light of the report, Peter Fitzgerald, director at Google, said: “We have seen a significant increase in the volume of searches for British retailers and brands coming from overseas. The majority of non-UK searches are currently coming from Europe, followed by North America and Asia, driven by the increased popularity of British brands abroad. Retailers can use search data to identify pockets of demand and move quickly to meet the needs of customers.”
Anita Balchandani, partner at OC&C, said: “There are a number of reasons why growth in e-commerce is changing the rules of internationalisation. Firstly, geographical proximity no longer determines which market is best suited for expansion – the internet allows customers seek out the best offers from around the world. Secondly, the nature of risk has changed. International expansion is much less capital intensive and this is creating growth opportunities which have a more controlled exposure to risk. Thirdly, the speed with which companies expand has also accelerated –over 40 of Britain’s top-100 etailers serve customers in more than 40 countries.”
Balchandani added: “E-commerce has transformed what was once a game anchored in local markets - with retailers choosing to expand internationally when they reached saturation nationally - into one where they can pursue internationalisation at the same time as domestic expansion. It is perhaps no surprise that companies like Amazon and eBay now generate about half of their revenues from international markets in a fraction of the time that it has taken the likes of Walmart and Tesco.”
Sports Direct sales rise 22.7% for Q3 Thursday, 21st February 2013
Sports Direct sees strong growth in its third quarter as sales rise 22.7 per cent to£244.8 million.
Total growth for the sportswear retailer rose 21.1 per cent to £589.5 million in the 13 weeks to the 27 January.
The results come as many retailers are plagued with a string of setbacks in sales, the problems mainly being caused by strong price growth that do not match the muted rise in wages. Sports Direct have managed to keep up to date with the growing online market as well as keeping the staff motivated by offering rewarding bonus schemes. The successful targeting of the European market has also had a strong impact on the final profit.
The group said it is confident it will hit its targets for underlying EBITDA of £270 million for 2013, before a charge for bonus share schemes.
Amazon expected to reveal record profits amid tax controversy Monday, 28th January 2013
Internet retail giant Amazon is expected to reveal record profits next week, amid continuing controversy regarding ongoing accusations of tax evasion.
Following a highly successful festive period, it is estimated that Amazon’s savings sharply increased to between $7 billion to $9 billion, compared to a total of $5.2 million in September.
The company’s success came during a period which saw several major high street retailers, including HMV, Blockbuster and Jessops, suffer financial collapse and go into administration. This sequence of events further proves that online retail is rapidly overtaking the high street as the dominant form of commerce.
Amazon and several other companies including Google and Starbucks have attracted controversy after it was discovered that they were diverting great sums of money to subsidiaries in other European nations. Amazon reportedly paid a mere $2.3 million in tax between 2009 and 2011, despite earnings of around $7 billion in total.
Morrisons and Lakeland to create new online retail site Monday, 21st January 2013
Photo credit: Lakeland
Morrisons has announced plans to create a new online retail site in cooperation with Lakeland to sell kitchenware.
It's not the first time Morrisons has expanded into online sales. In 2011, the company purchased Kiddicare.com and the following year created the website MorrisonsCellar. As online retail continuously increases its share of yearly retail sales, more and more retail chains are increasing their online presence.
Morrisons Chief Executive Dalton Philips has implied that Morrisons plans to continue to increase its online sales of non-food items in the future, stating that “We believe the future for these products is online rather than in supermarkets”. A spokesman for the company added that “There will be more of these launches as we create a range of non-food e-commerce ventures”.
It has been reported that Morrisons is also considering launching an online retail service for food.
Google announces £1bn project to develop new UK headquarters Friday, 18th January 2013
Google has announced that it intends to relocate its UK headquarters to a proposed office complex in London, a complex which is expected to cost the company around one billion pounds to construct.
The planned location of the development project is a 2.4 acre site between King’s Cross and St Pancras. The area has already seen significant redevelopment over the past several years, including the construction of a new Eurostar terminal in 2007.
When construction of the complex is completed in 2016, Google’s UK workforce will be relocated from the company’s already existing London headquarters in Victoria and St Giles High Street.
EBay enjoys 18% sales increase for Christmas 2012 Thursday, 17th January 2013
eBay's Christmas boutique. Photo credit: eBay Inc.
Leading online marketplace eBay has announced that it had a particularly successful Christmas period, reporting that sales increased by 18 per cent to reach a total of USD 3.99 billion.
The online retailer's marketplace division saw its earnings for the period increase by 16% compared to the previous year, to reach a total of USD 2.05 billion. However, it was the company’s PayPal division which saw the greatest increase. The division reported that its fourth quarter earnings had increased by 24 per cent to reach a total of USD 1.54 billion.
Ebay’s success during the Christmas period is symptomatic of the rapidly increasing dominance of online retail in general. The Interactive Media in Retail Group (IMRG) issued a press release revealing that “It was a very strong finish to the year for the online retail sector, with the Index recording growth of 14 per cent for 2012 as a whole”. It has been forecasted that sales figures and revenue for online retail will continue to increase in 2013.
Immediately following the announcement of eBay’s Christmas period earnings, the company’s shares rose to USD 53.33, an increase of 1.2 per cent.
PayPal adds more retailers to expansion Monday, 14th January 2013
PayPal’s move into retail outlets is proving successful after the company has exceeded its aim to sign-up 20 national retailers by the close of last year.
The bid to add 20 retailers since May 2012 has been topped, with 23 US retailers now accepting payment through PayPal at their check-outs. The system works by allowing customers to insert an “Access” card, mobile number or PIN into the payment terminal.
Don Kingsborough, vice president of retail services at PayPal, said that the system is “just technology that works and gets the most from your money.”
Having rejected rival Google’s approach with the NFC-based mobile wallet, Pay Pal have championed the mobile phone as the key to simplifying shopping.
Kingsborough stated "Some of the competition has stumbled with alternative technology offerings that don't address true customer pain points…we just want you to pay how you want; simple, fast and secure - with any method you want."
The 23 retailers represent 18,000 US stores nationwide, making Pay Pal’s move from being a solely internet-based method of payment a hit.
Marks & Spencer launches Chinese websites Monday, 7th January 2013
Photo credit: Marks & Spencer plc
Marks & Spencer continued its international expansion with the launch of a Chinese version of its e-commerce website alongside a dedicated retail space on China’s Tmall.com.
According to WWD, M&S has confirmed both online portals went live last month, alongside new store openings in Wenzhou, Jiangyin and Changzhou at the end of 2012.
The launch is the next step in the department store group’s expansion worldwide, which has so far been focused on expanding its e-commerce offering internationally, having opened in France, Ireland, Germany, Spain, Austria and Belgium last year. The retailer is thought to be aiming to trade across 10 international markets by the end of the year.
Record-breaking Cyber Monday becomes biggest internet shopping day ever Tuesday, 27th November 2012
Photo credit: Amazon
E-commerce sales rose 28.4 per cent for Cyber Monday, compared with the same time last year, as the latest reports put spending at USD 1.5 billion, making it the biggest online shopping day on record.
According to research from comScore, Cyber Monday is now thought to be the biggest internet shopping day in history, with USD 1.5 billion spent in total, breaking all previous records since the digital firm began tracking shoppers’ online buying habits in 2001.
With consumers in the United States heading back to the office after the Thanksgiving holiday and many retailers offering discounted prices to encourage sales, Cyber Monday has in recent years become a key day of trading on the shopping calendar, and the busiest day of the year for many online retailers.
According to tracking figures from IBM Benchmark, e-commerce sales in the US rose 28.4 per cent on Monday, compared with the same time last year, with sales from mobile devices including tablets up 10.1 per cent. Although UK retailers will be keeping a close eye on the States' Cyber Monday activity, recent years have shown British e-commerce sales often peak in the first week of December, as payday kicks off the busiest period of the peak trading season.
Amazon boosts profit margin with new businesses Friday, 27th July 2012
Amazon.com Inc saw second-quarter revenue rise 29 per cent from last year to USD 12.83 billion, as new businesses helped lift the ecommerce giant’s profit margins.
The retailer’s product revenue, which includes its traditional online business, grew 25 per cent to USD 10.79 billion, while its services revenue, which covers its online marketplace, was up an impressive 57 per cent to USD 2.04 billion.
Gross profit margins were up to 26.1 per cent in the second quarter, and up 24.1 per cent from the year before, according to analyst Scott Tilghman from Caris & Co speaking to Reuters.
Shakes in the world’s largest internet retailer rose 1.6 per cent in after hours trading to USD 223.59.