UK online sales set to double by 2010

British spending over the Internet is set to double, hitting almost 40 billion pounds, by 2010, a survey showed on Friday.

Online spending is expected to surge to 39 billion pounds, on the back of a more than 70 percent rise in the number of Internet shoppers, according to research by global payments system firm PayPal.

It anticipated the number of online shoppers to soar to 24.9 million in 2010 -- a rise of 71 percent on 2005 figures. That would see the future online retail market balloon to 49 percent of the adult population.

Carl Olav Scheible, head of merchant services at PayPal, said: "Over the past few years, we've seen the Internet gradually eating away at the high street.

"Consumer interest in broadband has been a key driver for the emergence of 'convenience home shopping' with 10 million UK households now signed up."

By 2010, a fifth of purchases in the UK that would not have happened on the high street will take place online -- creating an extra 3.2 billion pounds in consumer spending.

The largest gross profit areas are expected to be food and groceries, do-it-yourself and clothing.

It is anticipated that the grocery sector will take the lion's share of the online retail market. It is expected to rake in 6.25 billion pounds -- an increase of 235 percent on 2005 figures.

DIY, meanwhile, is expected to be worth 1.2 billion pounds, up 172 per cent on last year, and clothing and footwear 2.27 billion pounds, a 160 percent rise on 2005.

Other sectors in line for a surge in sales include health and beauty, music and video, books and electrical goods. The latter, in particular, is expected to be boosted by a shift of sales away from the high street. E-retailing of electrical goods is expected to be worth 4.6 billion pounds by 2010.

Online shopping grew at its fastest rate ever in Britain in the 10 weeks before Christmas last year, the Interactive Media in Retail Group, an industry body for electronic retailers, said earlier this year.

It expected the UK e-retailing market to grow 36 percent this year to 26 billion pounds. The group predicted that average individual spending would exceed 1,000 pounds for the first time during 2006.

Britain's retailers have acted to try to take a slice of the burgeoning online market. A quarter of the UK retail sector operated online in 2005, compared to just 7 percent the previous year, according to online retail technology firm Actinic.

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