Sale! eCommerce in retail

by admin on February 24, 2011

Presantha Jayamaha, Pyxle’s founder and MD talks about e Commerce in the retail industry in the latest edition of his weekly column for the Daily Mirror.

There is nothing quite as convenient as ordering something in the comfort of your home and then having it delivered to your door step! With this simple step the need to commute to a location, deal with traffic and parking, risk of product availability and the significant time obligation is completely eradicated. This is the Rat Race solution to the Rat Race generation!

Online retail is a mature industry in most developed and developing countries though it is at its infancy in Sri Lanka. As with all things technological; Sri Lanka usually follows suit behind most consumer behavior patterns and thus it is fair to conclude that a local eCommerce retail revolution will soon be on its way. Local websites such as Kapruka ( have already made a significant impact on the manner in which Sri Lankans residing internationally order gifts and pleasantries for friends and family in Sri Lanka.

E Commerce in Retail involves the searching, viewing and purchasing of various traditional retails items such as, but not limited to, clothes, books, shoes, music, grocery items, perfumes and personal care, gifts, meals or electrical items. Websites such as Amazon (, Tesco online (, Simply Computers ( and Walmart ( are some of the leading global online retail websites. What is interesting to note is that the Top 50 online Retail website belong to some of the best known traditional retail companies. These companies have identified the paradigm shift in consumer behavior and thus securely established themselves on both the online sphere and traditional sales channels. As more consumers move online; any company offering their products online will bound to have a financial edge over its more traditional competitors.

Online retail sales in the United States in 2009 were $144 billion and projected to reach a mammoth $248 billion by 2014; excluding hotel, music and ticket bookings. An interesting fact was that whilst all form of sales crashed in 2008 during the economic downturn; online sales increased by 10% and then continued to grow whilst the traditional retail industry struggled. This is insightful data on the movement of consumers from traditional shopping habits into more sustained online retail behavior.

So why do people shop online? It simply boils down to time, money and convenience! There is a significant cost savings for the retailer on each product since there isn’t an overhead cost of shop rental, electricity, sales staff and related to be factored into the final sales price. A portion of this saving is usually passed down to the buyer in terms of pricing; where an online retail shop front is usually cheaper (or gives better offers) than its traditional shop front counterpart. The retailer also has a better profit margin due to the removal or reduction of overhead costs. The time saving by shopping online can be significant due to the removal of activities such as traveling, parking, traffic or queuing. An ideal scenario would be a buyer taking her focus off work for a few minutes so that she can order the groceries, dinner and a birthday gift; and then refocusing back to her work within a few minutes and never leaving her desk. Another significant factor of online shopping is the availability of the entire product catalog in terms of color, size or style variations. The possibility of traveling to a store only to find out the product has been sold out or not available in a required size is eradicated.

Being a consumer in Sri Lanka we can expect a near future where more retailers will provides their products online together with better pricing and offers. As internet penetration increases and the cost benefits of shopping online become more obvious; it is fair to conclude that a shift in the buying pattern of the typical educated middle income consumer will follow suit.

(Presantha Jayamaha is the Managing Director of Pyxle Ltd; a Web and Software applications development company based out of Sri Lanka. He has been active member of the IT industry for over 10 years with a special interest in Internet Applications. As the MD of Pyxle, he plays a key role in studying, understanding and applying the latest global IT innovation. He is passionate about the internet and what it can do for people and business. He is an old boy of RMIT University)

The Article first appeared in the Daily Mirror.