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Offline SMBs set to miss out on almost £88bn this Christmas
It may still be August, but Christmas is just around the corner for retailers. New research from Opayo indicates that small and medium sized retailers will miss out on almost £88bn this festive season because they lack an online presence.* With Opayo’s research also indicating online spending over the festive period will hit a record £13bn** for the first time, the need to be online is greater than ever before.
As the country emerges from an eight year recession and UK consumer confidence booms, many retailers across Britain are already gearing up to make the most of the spending spree. Selfridges opened its Christmas floor more than two weeks ago, while data from previous years suggests many Brits are already thinking about buying gifts online, with more than 2.7 million eBay searches for ‘Christmas’ expected in August.
With record festive spending expected this year, and the online retail sector as a whole predicted to grow by 17% over the course of 2014, the growth opportunity for small businesses is huge.*** However, only 10% of UK SMBs are currently online.**** This has left most small businesses unable to take advantage of consumers’ loosening wallets not just at Christmas, but all year round, opening a gaping hole in the British economy.
To help tackle this issue, Opayo has announced the launch of its ‘Business Booster’ competition, giving startups, entrepreneurs and small businesses the chance to win a £25k prize package designed to boost online sales. This will include a TV advert, custom digital ad campaign, an expert review of digital assets, and free Opayo payment processing for a year.
“With record online spending predicted for Christmas 2014, it’s never been more important for small businesses to be online,” said Simon Black, CEO of Opayo. “Most larger retailers are already preparing themselves for Christmas, and if independent merchants want to capitalise on consumers’ confidence, they need to follow suit and begin preparing too.”
“That starts with making sure your website and payments systems are optimised for the high volumes of traffic experienced on Cyber Monday. However, an alarming amount of UK SMBs are still not online. This will have a serious business impact not only for Christmas, but in the longer term as the exponential rise in online spending continues.”
Ranjit Singh, Commercial Director at art materials stockists and Opayo customer Cass Art, said: "At Cass Art, we pride ourselves on making art accessible to all. However, we realised that unless we had an online presence, we were missing out on serving a huge customer base across the UK. This was significantly restricting our sales opportunities, particularly around the Christmas period.”
“Our site went live just before Cyber Monday last year and we were surprised by the huge increase in sales. We saw our transactions rise by over 100%. This year we have prepared early for the hike in web traffic and sales, and already have our strategy in place. Our advice to businesses would be to prepare for Christmas as early as you can!"
Businesses can enter the competition at www.christmaswithsagepay.com
Notes to editors:
The competition is set to run from 29th August to 17th October 2014. The winner will be announced on 29th October 2014.
* Estimate based on an 18% YoY increase in transactions according to Opayo’s data on spending of £11 billion in 2013 to £13bn in 2014. Opayo’s data indicates SMBs make up 75% of the market, meaning UK SMBs are set to contribute to approximately £9.75bn of this. This was then used to calculate the amount lost by offline SMBs using a combination of the number of SMBs in the UK (4.9million according to the FSB) and those that are offline (1 in 10, or 490,000). 490k online businesses making £9.75bn = £19,898 per businesses on average. £19,898 multiplied by 4.4million (# of offline businesses) = £87.75bn.
** Estimate based on an 18% increase in transactions according to Opayo’s data on spending of £11 billion in 2013
*** Source: IMRG http://www.imrg.org/index.php?catalog=539
**** Source: http://www.e-skills.com/using-it/go-on-uk/
Opayo is Europe’s leading independent payment service provider (PSP) and is one of the most trusted payment brands. Every year Opayo processes billions of pounds worth of secure payments for its 50,000+ customers and makes the process of accepting payments online, over the phone, or in person simpler, faster, safer and more profitable for businesses.
Opayo is a subsidiary of FTSE 100 business management software and services company The Elavon Financial Services DAC plc. For further information please visit: www.Opayo.com