Another great display of the power and allure of taking your business online is yesterday’s formal announcement by the Barclays brothers, owners of the Shop Direct Group (littlewoods), that they had bought the Woolworths brand and were going to turn the whole operation into an online-based seller.  All I thought of when I read that piece was ‘why didn’t woollies do that sooner?‘

With 800 stores nationwide and retail sales falling year on year with the online outlook getting better and better every year, why didn’t woolworths just sell 50% of their shops and re-invest the money into a contact-centre like setup where orders could be fulfilled from their online website and a warehouse? Why did it take the company to go into administration before they realised their mix wasn’t right?  Perhaps they were putting too many eggs in their distribution basket, hoping that other companies who were trading online who were buying from them (zavvi.co.uk) would continue to grow and keep them afloat.  I can’t help but feel that woolies missed the boat last time round and this new announcement to bring woolies back online is both a show of fortitude for the online selling industry and a good move from the barclays brothers.

“We’ve got high hopes and big ideas for the Woolworths we want to bring back to you!” is what the www.woolworths.co.uk website read today, let’s see if they mean it when they actually launch the website.  Let’s see if they really do get it right…

Even as companies continue to struggle, the important take-away is that the Web is continuing to grow, with online retail sales projected to rise 11% this year

Christmas 2008 has just passed, Woolworths and Waterford Wedgwood are amongst some of the latest iconic British companies to go into adminstration and the UK is in the midst of it’s deepest recession since the 1930’s.  High St. retailers all over the country are reporting some of their worst Christmas trading results in decades and as of today, a reported 80,000 UK jobs have been lost and pretty much everything looks bleak and depressing.  Is there any light at the end of the tunnell or is it really the end of the world as we know it?  Well, actually, there’s quite a bright light for some…

And it comes in the guise of those companies ready and willing to cut their losses on the High St. and move with renewed energy and vigour into online selling.  According to a report by the BBC on the 18 January 2009, Online Sales had risen 50% over last year’s figures.  The report revealed that internet sales between 1 October and 31 December ‘08 hit £15.2bn, up from £9.61bn a year earlier, with electronics and clothing doing particularly well.

Some of the winners in E-Christmas ‘08 were HMVs Waterstones, John Lewis, Argos and Tesco, all of which have poured substantial efforts into rejuvenating their online presence over the last year.  On the flip side, Zavvi.co.uk, the renamed Virgin Megastores, who also spent millions on developing their online presence in 2008, ended up on the wrong end of a bad supply chain when Entertainment UK Ltd. (their main supplier of DVDs and Games), part of the Woolworths group, went into administration just before Christmas – Ouch!  I wish I could say Zavvi were an innocent bystander of the infamous financial meltdown but honestly, who ever thought sticking all your eggs in one balloon was really a good idea?

So what does all of this mean for you and me? The little guy facing rising rent and lease charges, increased energy bills and a complete lack of financial backing from pretty much every bank on the High St?

Simple, it means that if you’ve never considered moving your operations online before, then you need to do it now because that, my countrymen, is where the future lies. I don’t mean that to sound prophetic or profound, but its a simple consequence of fact:

1. Barriers to entry online are very low. For example, pay us £995 and we’ll get you a website online within 14 days!
2. Trading online allows you to cut the cost of increasing rent in prominent High St. locations by moving your operations to local authority-funded business parks or workshop units.  In some cases, you can qualify for up to 6 months at half price subsidised rent which even at full price will come in approximately 60% lower than more traditional High St. locations.
3. With online sales set to increase by a further 50% in 2009 and the growing acceptance of online shopping – even by the baby boomers – there’s never been a better time to take your sales online.

Our own 2008 client portfolio saw total sales of over £2m from online sales last year and we’re looking to aggressively expand on that figure for 2009.

For those of you who aren’t afraid of the internet and really want to capture a piece of this £20bn online shopping spree, we can help.