Online retailers collectively made a profit last year for the first time as sales jumped a better-than-expected 51 percent, in a sign of continued resilience in e-commerce, an industry survey found.
Online sales surged to $114 billion last year, surpassing forecasts of $96 billion, fueled by the travel category, according to an annual survey of 150 retailers conducted by Shop.org, the online arm of the National Retail Federation, and Forrester Research, an Internet research company.
The online retailers broke even in 2002 as sales, which include those from brick-and-mortar and catalog companies as well as strictly Web-based companies, totaled $76 billion, the survey, being released today, said.
“This positions online retailing as a real profit engine for retailers,” said Scott Silverman, executive director of Shop.org., noting that typical brick and mortar stores have an operating profit margin of between 3 percent and 10 percent compared with 21 percent margins among the online retail shops.
The report, published annually since 1997, is considered one of the most comprehensive assessments of the health of the online retailing industry. It offers a wider measure of online retail sales than the Department of Commerce reports, as it includes transactions from travel, event tickets and auctions.
Excluding travel, online sales increased 34 percent to $71.8 million last year.