According to a recent PayPal study, businesses that are quickest to get online were more likely to see an increase in revenue and staff, demonstrating once again the importance of having a solid web offering.
PayPal Australia has today released preliminary results from a study that focusses on SMB retailers and was conducted by Roy Morgan. The study found that those businesses that moved online the quickest were more likely to show an increase in revenue and staff numbers.
Roy Morgan surveyed 200 Australia SMB retailers over the course of six days in July this year. Full results from the study will be released later this month.
Preliminary results show that over the last year, business growth increased by an average of five percent for those companies that had been selling online for at least 12 months. On the other hand, businesses that hadn’t been online for at least a year displayed an average decrease in size of four percent.
- While one out of two (49%) businesses that have sold online for at least a year grew in revenue, as opposed to only one third (36%) of those that hadn’t been selling online for at least that period.
- 17% of early adopter SMB retailers increased staff, while only 13% of other businesses showed any increase.
- Only one third of businesses have had the ability to sell online for at least 12 months.
It is this last finding of the report that is perhaps the most worrying. Despite the obvious benefits for opening up shop on the internet, the majority of Australian retail SMBs still have no online presence. The Australian online retail sector has grown into a $31.7 billion market this year, but according to ABS data, 72 percent of businesses can’t even receive orders online.
Russell Zimmerman, Executive Director of the Australian Retailers Association, said, “These results confirm that the global transition to online retail has been a significant challenge for many local businesses. However, we know retailers here must keep pace with changing global market trends as future growth in the sector will unequivocally come from digital channels.”
Unfortunately, setting up an online sales channel does take time, knowledge and resources. Worse still, the opportunity won’t last forever. As early adopters move online and expand quickly, the markets available for each category or product become increasingly crowded. It won’t be long before small retailers with limited resources simply won’t be able to compete when trying to move online.
How crucial do you think the next 12 months will be for these online laggards? How long can an SMB retailer survive without a functional webstore?