Retailers Expect 22% Rise in On-Line Sales

Chicago, U.S. on-line retailers expect sales to rise 22% to $172.4 billion in 2005, with the biggest gains likely coming from cosmetics, perfume and other sectors aimed at women, according to a survey released this week. The annual report by Forrester Research and Shop.org, the on-line retailing arm of the National Retail Federation trade group, reflects survey data from 136 retailers. Excluding sales of travel services, the report found that on-line sales were up 23.8% to $89 billion, which comprises 4.6% of total U.S. retail sales. Total on-line sales rose 23.8% to $141.4 billion in 2004. In addition, on-line retailers reported operating margins of 28%, an improvement over 2003’s 21%, the survey revealed.

“Though initially adopted by men as a shopping tool, women are flocking to the Internet in droves to comparison shop, research and buy,” said Scott Silverman, executive director of Shop.org. Looking ahead, survey respondents said on average they expect increases of 33% for cosmetics and perfume, 32% for over-the-counter medications and personal care, and 31% for jewelry and luxury goods.