Great expectations for online retailers

Santa's elves have been warned to expect to spend much of the pre-Christmas period on their PCs taking orders from the growing list of online retailers.

The latest estimates from Internet research companies predict Australians will spend approximately $150 to $200 million online this Yuletide season.

Managing director of online IT retailer E-Store Steven Spilly said the company was going through a rapid growth rate and it was difficult to attribute particular sales to Christmas.

Spilly said E-Store was selling more than $500,000 worth of goods every month, and taking another 20 to 25 per cent of orders that were subject to approval from businesses such as RentSmart.

Chief executive of Wishlist.com, Huy Truong, said the growth in volume of sales from the site had "very much exceeded expectations" after more than tripling over the last five weeks.

In fact, Truong said the company had increased sales from about 60 packages a day to 300 to 350 a day in the buildup to Christmas.

Due to the popularity of purchasing online, Truong said the company was continually increasing its capacity but admitted it may have trouble meeting some of the demand.

"You have got to accept as part of a formative stage of a new type of business that there might be some problems with meeting demand. As a result, we have looked at our budget of products doubled it and added 20 per cent to increase our capacity," Truong said.

Research from the IDC predicts the Asia/Pacific (excluding Japan) online population, expected to reach 21.8 million, will spend $US2.2 billion on line by the end of 1999, compared with $US722.7 million by the end of 1998.

The report predicts online revenues in the region will reach almost $US90 billion by 2004.

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David Smedley

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