On-line sales in Canada surged 40 per cent last year, fuelled by the increasing prevalence of high-speed Internet access, Statistics Canada said Friday.
Last year, combined private and public sector sales on-line totalled $19.1-billion, a 40-per-cent increase over the previous year's levels.
The latest number also continued the growth trend, building on 2002's gain of 27 per cent.
“A major factor in rising e-commerce, particularly in the private sector, is the adoption of high speed access to the Internet,” Statscan said.
In 2003, about two-thirds of all private companies used broadband or high-speed Internet access, up from 58 per cent in 2002 and 48 per cent the year before that.
However, despite the significant growth in e-commerce, on-line sales remain only a fraction of operating revenues for private businesses.
Last year, on-line sales accounted for just 1 per cent of total revenues for those firms.
Private firms account for the vast majority of on-line sales — totalling $18.6-billion in 2003 — but just 7 per cent of private sector businesses sold goods and services on-line last year.
The bulk of goods and services being sold via the Internet were also being peddled to the home crowd.
According to Friday's report, the domestic market made up 87 per cent of total sales, up from 78 per cent the year before.
“Domestic sales increased 55.2 per cent last year to $16.6-billion, accounting for all of the growth in on-line sales,” the government agency noted.
Sales for export, meanwhile, feel slightly to $2.4-billion last year from $2.9-billion in 2002.
As for the consumer market, the dollar value of business-to-consumer sales rose 51 per cent last year to $5.5-billion. Business-to-business sales rose 35 per cent to $13.1-billion.
The biggest chunk by volume of on-line sales to consumers came in the retail sector, where trade totalled j$1.7-billion. That accounted for about 82 per cent of retailers' business on-line.
Percentage-wise, however, the arts, entertainment and recreation sector saw sales to consumers account for the biggest proportion of on-line sales, at 92 per cent.
For companies not venturing into the on-line arena, the biggest stumbling block was product type.
Forty-seven per cent of those firms not selling over the Internet said their products didn't lend themselves to that type of business.
“More than one in three firms that do not sell on-line said e-commerce was incompatible with their current business model, and they would prefer to follow their existing strategy,” Statscan said.
“Other concerns included security issues and the cost of creating and maintaining an e-commerce-enabled website.”
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