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UK retail industry lags on e-business adoption

Daniel Thomas
UK retailers are lagging behind other UK industries and foreign retailers in their use of e-commerce technology, according to government research.

Consulting giant PricewaterhouseCoopers interviewed more than 50 retailers, ranging from major supermarkets to independent convenience stores. It found that only 30% of respondents have Web sites.

The survey, commissioned by the Department of Trade & Industry as part of a campaign to speed up e-commerce adoption, also found that 27% of retailers do not plan to use e-commerce at all, 25% of which were macro - medium or large - firms.

Investment costs were found to be the greatest barrier to e-commerce, as identified by 40% of respondents. The lack of in-house technology was cited by 38% of retailers.

The report highlighted that business-to-business e-commerce appears to offer more benefit to grocery retailers than generating revenues directly from customers. Some 39% of respondents have Internet access to a supplier's extranet and 36% exchange electronic data information (EDI) with suppliers.

The report said, "Most grocery retailers, particularly the smaller stores and chains, appear to have taken little advantage of e-commerce to date. Indeed, it is possible that the advent of e-commerce will widen the gulf between the most sophisticated large players and the smaller, independent grocery retailers."

Despite the general lack of take up of e-commerce, two thirds of respondents, including 50% of micro companies, believe e-commerce is likely to transform the way the retail sector does business in the next two years.

Responding to the findings, Douglas Alexander, minister for e-commerce and competitiveness, said, "An understanding of the benefits of e-commerce, management attitude and vision are key to identifying new opportunities and ensuring that businesses of all sizes can seize the competitive advantage.

"Our research highlights the major issues which most businesses need to address if they are to remain competitive in the modern, high-technology world."

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