RM survey reveals UK SME e-retailers plan on combining brick

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Royal Mail survey reveals UK SME e-retailers plan on combining bricks with clicks for 2014 sales success

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One in six UK SME e-retailers are planning to expand into physical stores in 2014 as online competition for sales grows, according to a study by Royal Mail.

The annual study of more than 400 UK SME online retailers found that 16 per cent expected to open their own physical store or seek space in an existing store to increase its sales; in addition 15 per cent of UK SME e-retailers revealed that they were planning to expand by using online marketplaces at some point this year.

Over a third (40 per cent) said they planned on starting to use new channels to increase trade in the coming 12 months. More than half (56 per cent) of respondents said they were confident of sales growth in 2014, though this figure was down eight per cent on the 64 per cent of UK SME online retailers who were confident of growing sales a year ago.

Fifty-four per cent said competition for online shoppers was more intense now than this time last year, with six in 10 (59 per cent) attributing this to more websites to compete with. Fifty-seven per cent cited customer price sensitivity as the main reason behind increased competition.

Of the findings, Nick Landon, MD of Royal Mail Parcels, said: “UK SME online retailers are thinking carefully about how they can develop their businesses during 2014. They are concentrating on exploiting as many channels to market as possible, adding space in physical premises and online marketplace listings to complement their existing web channel. In addition, they are concentrating on how to price competitively while increasing the range and quality of their goods.”

Competitive pricing has become top priority for customer satisfaction in 2014, with quality of products falling to become the third most popular priority after being ranked top by UK SME online retailers in 2013 and 2012.