A new report published by retail analysts Verdict suggests that the value of on-line grocery retailing is set to grow to £5.7 billion by 2006. This year, grocery will account for half of all retail on-line sales – £1.2 billion, although this figure is still only 1.4% of all retail grocery sales. By 2006, Verdict forecasts that 5.7% of all grocery sales will be channelled through on-line media – to be worth £5.7 billion. This will be 40% of total retail on-line sales worth £14.4 billion, accounting for 5.6% of all retail sales.

A general expansion of internet sales is likely to take place as the number of consumers buying on-line is expected to rise from the present figure of 5.9 million to about 14.4 million. If this is to happen, Verdict says that lingering concerns about security aspects of on-line sales must be dispelled. The report cites security fears as the principal deterrent for many potential on-line consumers.

The report also notes that several of the leading on-line retailers, including Next, Amazon and Tesco, appear to be suffering slight losses in internet sales as competition from other well known brands increases. Verdict suggests that high street retailers continue to appear better placed in general to attract on-line shoppers, whereas retailers operating purely via the internet will find it increasingly difficult to secure a strong client basis.

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