eBay reveals ‘Northern Powerhouse’ of online retail businesses
New data shows Brits are biggest exporters in Europe
The UK is outpacing its European neighbours, and the North of England is overtaking the rest of the country in online retailing, a new report by eBay’s Public Policy Lab has revealed.
Bucking the popular perception that clusters of digital businesses only exist in London, eBay’s report shows that Greater Manchester has a greater concentration of small online businesses than anywhere else in the UK.
The report’s authors calculated “digital densities” based on the volume of small online retail businesses operating in a region and their sales, as a proportion of the local population.
Manchester is followed in the UK digital density rankings by Lancashire and West Yorkshire, revealing a new ‘Northern Powerhouse’ of ecommerce.
These businesses range from fledgling ecommerce start-ups and ‘homepreneurs,’ through to fast-growing businesses like Thingimijigs, which started with just an eBay account, £200 and a kitchen table and now sells branded gifts and accessories for kids globally from a purpose built facility in Burnley.
The top UK regions with the highest concentration of small online retail businesses are:
1. Greater Manchester
3. West Yorkshire
4. Leicestershire, Rutland and Northamptonshire
7. West Midlands
8. Herefordshire, Worcestershire and Warwickshire
9. Derbyshire and Nottinghamshire
10. Shropshire and Staffordshire
Inner London, which includes Shoreditch and Tech City, is in 26th place.
The report, based on newly released eBay data, independently analysed by law firm, Sidley Austin LLP, also reveals that the UK is the most advanced market in Europe for global exports.
Over half (51.8%) of small online retail businesses in the UK are ‘global’ – exporting to four or more different continents – more than any other European country. France follows closely on 50.6%, Spain on 41.9% and Italy at 34.6% and Germany at 19.6%.
The number of small British online retailers exporting to 15 or more countries has grown by 33% since 2010, and now almost all online small businesses on eBay in the UK export goods abroad - 91%, in comparison to 28% of traditional offline small businesses.
Sarah Calcott, Director of Operations at eBay UK, commented:
“Our research shows that technology is opening up tremendous opportunities for small businesses across the UK with digital clusters spread across the country, particularly in the North West and Yorkshire.
“At eBay we’re working hard to ignite the entrepreneurial spirit of small online businesses, providing them with the tools and the flexibility to export millions of British goods abroad, despite lacking the infrastructure of a traditional exporter.
“Our technology is now breaking down barriers to global markets by allowing small businesses access to products and services that were once the preserve of large firms, such as smart shipping, international payments and translation, and using our global market to access millions of potential customers.”
NORTHERN POWERHOUSE CASE STUDY: PF Jones, Greater Manchester
Family run business PF Jones was founded in July 1958 by Percy Frederick Jones. The Manchester-based business originally sold diesel injectors and fuel pumps.
In 2009, PF Jones added to its four bricks and mortar branches (in Manchester, Stoke on Trent, Buckley and Wigan), by launching an online store on eBay with the intention of increasing the firm’s customer base and boosting profits.
Since then, the company’s eBay turnover has doubled, causing them to expand their premises to cope with demand. Today PF Jones completes on average 100-150 transactions a day. Its eBay store has also created jobs, with five people now employed to solely manage the company’s eBay business.
EXPORTING CASE STUDY: Electrolve Ltd, Grimsby
Business founder Oliver Margarson started dabbling in online sales as a student in order to earn extra cash. In 2008 he turned this part-time venture into a full-time business. Electrolve Ltd, listed on eBay under etwist_shop, sells audio-visual items and accessories and other small household electronics.
In 2010 Oliver hired his first employee. Having originally run the business from a bedroom, Electrolve Ltd now operates from a 16,000 sq. foot warehouse, employs eight people and since inception has doubled its year on year sales.
About 40% of the business is exports. 25% of that is within Europe and 15% of the products go to the rest of the world. The company has shipped to 170 countries to date including the U.S., Australia and Israel.