The impact of online retail is being experienced by businesses in all sectors. Due to the growing use of mobile devices and an expanded reach of powerful wireless networks, consumers are connected at all times. The Internet has become a crucial tool during shopping sessions, whether it is to check prices in other stores, read product reviews or search for coupons, and it is used to do more than just buy products.
According to a report from Forrester Research, e-commerce sales are expected to grow by $151 billion in the next five years from $263 billion 2013 to $414 billion in 2018. That is a compound annual growth rate of 9.5 percent. On top of that, the percentage of total retail sales that happen online will increase from 8 percent to 11 percent during this time frame.
These numbers have increased when compared to last year’s report that stopped in 2017. The previous incarnation forecast that e-commerce sales in 2017 would reach $370 billion. That has been increased to 4 percent to $385 billion.
In an interview with Internet Retail about the study, Forrester analyst Sucharita Mulpuru spoke about the projected growth and what could cause it. She said that consumers shopping on their mobile devices will be what propels the growth of online retail.
On top of this is the fact that more consumers are starting to become technology savvy. This is happening as the older generation learns of the benefits of e-commerce and the younger generation that has grown up with technology starts to get jobs and have disposable income. The average Generation Y member (ages 25 to 33) spent $563 over the last three months, more than any other age bracket.
While online shopping is on the rise, it does come with it fair share of challenges. One of the biggest comes from the actual fulfillment orders that are placed online. This past holiday season saw many last minute orders not being processed and delivered on time because of inventory problems and shipping mishaps.
“Retailers need to ensure that they don’t botch that moment of truth with late orders, which seem even more likely to happen as more and more shoppers wait until the last minute to purchase and more retailers cram web orders into an already congested delivery network,” Mulpuru writes.
Online sales are not going away, and the fact that sales on this platform are expected to increase by $151 billion in the next four years is reason enough for merchants to make sure they are successfully managing the platform. However, it needs to be handled smartly. Businesses have to do more than just build a website and hope everything goes well. It is critical that solutions are integrated together into a single solution that helps merchants keep track of inventory and meet consumer demand, regardless of what platform it is sold through.
This is easy to accomplish by partnering with a retail solution provider that can deploy a POS with fully integrated e-commerce solution that also has inventory management software. VRP will combine all systems under a single umbrella and improve operations. Please contact us if you would like more information about our complete POS toolbox and to evaluate our free demo!