|Last Quarterly Update:||1/30/2017|
|SIC Codes:||5961, 7389|
|Industry Overview||Trends & Challenges||Industry Forecast|
|Quarterly Industry Update||Call Prep Questions||Website & Media Links|
|Business Challenges||Financial Information||Glossary & Acronyms|
Companies in this industry sell merchandise on retail websites, online auctions, mail-order catalogs, toll-free telephone numbers, television shows, or other business channels. Major companies include US-based Amazon, eBay, HSN, QVC, and Newegg, as well as Alibaba Group (China), Argos (UK), MercadoLibre (Argentina), and Otto Group (Germany).
Nonstore sales mainly take place online. Annual global revenue from e-commerce is about $1.7 trillion, representing 7.3% of overall global retail sales, according to eMarketer. Growth is driven by increasing Internet use in emerging markets, as well as rising mobile commerce sales. Top countries for e-commerce sales include China, the US, the UK, Japan, and Germany.
The US nonstore retail industry includes about 30,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of more than $450 billion.
Demand is driven by consumers’ personal income. The profitability of individual online retailers depends on effective marketing and competitive pricing to build a customer base. Larger firms enjoy central purchasing efficiencies and economies of scale in inventory management, customer service, and telecommunications. Smaller firms compete on outstanding customer service and providing niche products. The industry is concentrated: the top 50 companies account for about 60% of revenue.
Companies in the Internet auctions industry, such as eBay and Taobao in China, generally compete with online retailers and physical retail establishments. Some companies do business in several of those areas, selling items through conventional e-commerce systems in ...
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