85,000 businesses launch online shops during lockdown

COVID-19 has sparked a retail transformation in the UK, with more than 85,000 businesses launching online stores or joining online marketplaces in the last four months, according to new research from Growth Intelligence.

With more than 750,000 businesses forced to close their doors under lockdown restrictions, businesses in nearly every sector have accelerated their digital transformation to meet growing demand for online shopping.

Growth Intelligence used artificial intelligence technology to read and interpret millions of business websites across the whole of the UK’s small business ecosystem, identifying the highest number of new e-commerce offerings ever recorded over a four-month period.

As well as businesses that have historically dominated the space, the crisis has seen some less likely businesses going online. The fashion and apparel sector has seen the largest number of businesses opening e-commerce sites since February, with 8,665 clothing companies adding online payment methods. But manufacturing (7,129), food and drink retail (4,156) and agriculture, fisheries and industrial food production (3,767) were not far behind.

Amongst the industries seeing the biggest transformation have been pharmacies, 9.3 per cent of which launched new ways of selling online during lockdown. Farms, fisheries and industrial food production followed with 6.9 per cent, as well as professional training, where 6.8 per cent of businesses in that sector launched a way of selling online.

Different parts of the UK have experienced varying rates of digitisation. The South West has seen the most businesses launch e-commerce offerings in relation to the total number of businesses in the region, with 4,170 online shops created. Yorkshire and The Humber (3,313 launches) came next, followed by the East Midlands (3,120). Scotland had the smallest proportion of businesses launching e-commerce offerings (2,277).

Growth Intelligence’s AI monitoring found that of the 762,250 businesses that were forced to close due to COVID-19, only 308,861 (41 per cent) have fully reopened, with 453,389 (59 per cent) either still closed or trading under severe revenue-limiting restrictions such limited hours, limited locations, seeing clients by appointment only, adding waiting lists, cancelling historical orders or only serving key workers.

Tom Gatten, chief executive of Growth Intelligence, said: “Being unable to trade in the traditional sense has been a catalyst in driving digital transformation and where one door has closed, this nation of shopkeepers has forced another to open.

"Thousands of businesses are making the most of the tremendous opportunity that growing demand for online shopping is creating - while our data shows a very slow return to what we previously considered ‘normal’, the new environment is opening new markets and this will reinvigorate the economy.”

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