Internet, TV & Mail-Order Retailers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 40,800 Internet, TV and mail-order retailers in the US sell merchandise through non-store channels, including catalogs, toll-free numbers, the Internet, and television (electronic shopping). Major product categories include drugs, health and beauty aids; computers and software; and clothing and accessories. Examples of Internet, TV and mail-order retailers include Internet auction sites, mail order book clubs, catalog/call center operations, Internet-only retailers, and home shopping networks.

Seasonal Demand

Similar to the traditional retail industry, Internet, TV, and mail-order retailers experience seasonal sales, with peaks during the winter holidays.

Reliance On Information Systems

System interruptions or problems with communications suppliers can result in outages or loss of critical data.

Industry size & Structure

The average Internet, TV, or mail-order retailer operates out of a single location, employs 10 workers, and generates $20 million annually.

    • The Internet, TV, and mail-order retail industry consists of 40,800 companies that employ over 420,000 workers and generate $837 billion annually.
    • The industry is concentrated at the top and fragmented at the bottom; the top 50 firms account for about 63% of industry sales.
    • Large companies include Amazon, eBay, Qurate (QVC and Home Shopping Network), Plow & Hearth, and L.L. Bean. Many large companies have international operations.
                                Industry Forecast
                                Internet, TV & Mail-Order Retailers Industry Growth
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Mar 3, 2023 - Free Shipping Crucial to Most Shoppers
                                • More than 60% of shoppers said they would not shop at an e-commerce company that doesn't offer free shipping, up from 52% the previous year, according to a survey by Shippo in Multichannel Merchant. Nearly half said they would pay more for a minimum order threshold for free shipping. High shipping costs were merchants' top concern in 2022 and looking ahead to 2023. About 44% of merchants said they're spending an average of 11% of order value on shipping, with a third saying the figure was between 11% and 20%. Meanwhile, supply chain delays, a major issue in the past two years, were only cited by 12% as a concern. Less than half of merchants provide an average e-commerce shipping time on the checkout page, although shoppers desire this item. Nearly 30% of consumers said they did all or most of their shopping online, up from 16% last year.
                                • Consumer confidence levels declined in February 2023 for the second consecutive month, according to data from The Conference Board. The Conference Board’s consumer confidence index fell to 102.9 in February 2023 from 106 in January 2023, as high prices and rising interest rates affected consumers’ willingness to spend. According to Ataman Ozyildirim, a senior director of economics at The Conference Board, “Consumer confidence declined again in February. The decrease reflected large drops in confidence for households aged 35 to 54 and for households earning $35,000 or more.” Plans to purchase homes, vehicles, and appliances have cooled, in addition to a drop in vacation intentions, per Ozyildirim.
                                • Online retail sales, excluding travel, climbed 11% to over $1 trillion in 2022 for the first time in history, according to a Comscore “State of Digital Commerce” report in Retail Dive. Online retail sales had its “highest quarter ever” in the fourth quarter of 2022, reaching sales of $332.2 billion. Consumers are also increasingly shopping on mobile devices. Mobile sales grew by more than a quarter in the fourth quarter of 2022 over the previous year and now account for nearly 40% of overall digital commerce sales. According to the report, the top grossing digital commerce categories in 2022 were food, pet, and baby goods ($219 billion), apparel and accessories ($175 billion), and computers and peripherals ($117 billion). High growth categories included apparel and accessories (up 37%), video games and accessories (up 31%), and home and garden (up 25%).
                                • Amazon has started making drone deliveries in Texas and Washington state, according to Multichannel Merchant. The online retailer began its aerial deliveries in December 2022 in College Station, Texas, and Lockeford, California. Amazon received approval from the Federal Aviation Administration in August for drone deliveries. About 85% of the company’s ecommerce deliveries are up to 5 pounds, which is the maximum payload for its drone deliveries. According to Logistics Viewpoints, Amazon’s goal is to deliver 500 million packages annually by drone to customers by the end of the decade. Amazon joins Walmart, Walgreens, and other major retailers in expanding into drone use as a delivery option.
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