5 Numbers showing why the Time to Invest in eCommerce in the UK is Now

A decade or two ago, you might have already had the urge to invest in eCommerce. But astute as you are, you must have decided to wait for the right time and perhaps the right place to do it. That time has come. And the right place to do it? Try the United Kingdom.

Here’s why:

1. ?100 billion worth to the UK economy

A report conducted by US-based BCG (Boston Consulting Group) showed that Internet-based business in the UK reached ?100 billion in 2009. That translated to 7.2% of the country’s GDP that year, making it bigger than industries like construction, education, and health & social work, and even slightly bigger than agriculture, hotels & restaurants, and mining, combined. Click here to see the comparison shown as a graph.

?100 billion?is certainly huge, but?the market potential of the Internet in UK is even made more evident if you also look at the numbers based on amount spent per capita…

2. # 1 in per capita spending

According to IMRG (Interactive Media in Retail Group), “the UK’s per capita spend of ?1333 (?1108) per annum” is number one in the world. This shows that people from the United Kingdom are more willing to buy goods from the Internet than other people on the planet. And this alone should tell you why UK is the best place for e-commerce.

But while you’re still pondering whether now is really the best time to invest, bear in mind that competitors who have gone to the Internet before you are already thinking of expanding …

3. 1.5 million workers in Internet retailing by 2015

Last year (2011), the number of people employed in UK e-businesses was about 730,000. While conducting its second annual e-Jobs index in 2011, IMRG (Interactive Media in Retail Group) found out that it was largely due to a rise in employment in 63% of e-businesses. The study also showed that 60% of e-businesses were also planning to beef up their employees within a year’s time.

While other sectors are shrinking their ?workforce, businesses on the Internet are growing theirs. Were they just speculating? Perhaps not…

4. 50% of parsels during 2016 pre-Christmas peak will come from e-commerce

Last year (2011), parcels coming from e-commerce accounted for 37% of all items sent through UK couriers during the November-December stretch. That volume from e-commerce was 15% higher than the previous year. This remarkable climb, which was reported by Global Freight Solutions (GFS), shows the growing confidence of customers when it comes to buying products online.

If this rate continues, items from e-commerce will easily comprise 50% of parcels by 2016. Chances this rate will continue? Let’s go to number 5 and you be the judge.

5. 66% of all adults made online purchases in 2011

A statistical bulletin published by the ?Office for National Statistics revealed that 32 million people made online purchases in 2011. That actually comprises 66% of all adults in the UK. Significant as that may seem, what is really striking is that that figure used to be 62% in 2010. So again, this proves that the number of people who buy products and services online is steadily growing.

If you really think about it, these statistics should not be surprising. The smartphone is now practically the default mobile device of anyone who owns a mobile phone. And then of course there are laptops and tablets.

With these devices on hand, coupled with the ever growing number of WiFi hotspots and telecommunications bandwidth, gaining access to the Web has never been easier.?It can be done practically anytime, anywhere.

This makes it so easy for people to search for products, compare competing brands, and eventually make a purchase from home, the office, on the terminal, or on the train.

Related post:

Integrated e-commerce ? The right way to do extend your business online

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How Alcoa Canned the Cost of Recycling

Alcoa is one of the world?s largest aluminium smelting and casting multinationals, and involves itself in everything from tin cans, to jet engines to single-forged hulls for combat vehicles. Energy costs represent 26% of the company?s total refining costs, while electricity contributes 27% of primary production outlays. Its Barberton Ohio plant shaved 30% off both energy use and energy cost, after a capital outlay of just $21 million, which for it, is a drop in the bucket.

Aluminium smelting is so expensive that some critics describe the product as ?solid electricity?. In simple terms, the method used is electrolysis whereby current passes through the raw material in order to decompose it into its component chemicals. The cryolite electrolyte heats up to 1,000 degrees C (1,832 degrees F) and converts the aluminium ions into molten metal. This sinks to the bottom of the vat and is collected through a drain. Then they cast it into crude billets plugs, which when cooled can be re-smelted and turned into useful products.

The Alcoa Barberton factory manufactures cast aluminium wheels across approximately 50,000 square feet (4,645 square meters) of plant. It had been sending its scrap to a sister company 800 miles away; who processed it into aluminium billets – before sending them back for Barberton to turn into even more wheels. By building its own recycling plant 60 miles away that was 30% more efficient, the plant halved its energy costs: 50% of this was through process engineering, while the balance came from transportation.

The transport saving followed naturally. The recycling savings came from a state-of-the-art plant that slashed energy costs and reduced greenhouse gas emissions. Interestingly enough, processing recycled aluminium uses just 5% of energy needed to process virgin bauxite ore. Finally, aluminium wheels are 45% lighter than steel, resulting in an energy saving for Alcoa Barberton?s customers too.

The changes helped raise employee awareness of the need to innovate in smaller things too, like scheduling production to increase energy efficiency and making sure to gather every ounce of scrap. The strategic change created 30 new positions and helped secure 350 existing jobs.

The direction that Barberton took in terms of scrap metal recycling was as simple as it was effective. The decision process was equally straightforward. First, measure your energy consumption at each part of the process, then define the alternatives, forecast the benefits, confirm and implement. Of course, you also need to be able to visualise what becomes possible when you break with tradition.

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Energy Savings Opportunity Scheme (ESOS): An Overview

Energy management is crucial to most businesses in the UK. This is primarily because energy usage substantially affects all organizations, whether large or small. The good news is that, energy costs can be controlled through improved energy efficiency. And this is exactly why Energy Savings Opportunity Scheme (ESOS) came into being ? to promote competitiveness among businesses.

Energy Savings Opportunity Scheme is the realisation of the UK Government’s ambition towards achieving the maximum potential of cost-effective energy in the economy. ESOS aims to stimulate innovation and growth, cut emissions and support a sustainable energy system.

ESOS at a Glance – Legal Perspective

The EU Energy Efficiency Directive took a major step forward on November 14, 2012 and headed towards establishing a framework to promote energy efficiency across various economic sectors. To interpret Article 8 of the Directive, the government has given birth to ESOS; requiring large enterprises to undergo mandatory energy audits and energy management systems by December 5, 2015 and at least every 4 years thereafter.

Large enterprises include UK companies that have more than 250 employees or those businesses whose annual turnover exceeds ?50 million and whose statement of financial position totals more than ?43 million. With this, over 7000 of the biggest companies in Britain will need to comply with ESOS as an approach to review their total energy use in buildings, business operations, transport and industrial processes.

Generally, ESOS is both an obligation and an opportunity. It is an obligation for the indicated target companies since they need to submit to additional regimes; focus on audit evidences; act in accordance to group structures and compliance; and observe limited penalties and note retention periods. Moreover, it is also an opportunity for companies to strive for more savings on energy projects; attempt to standardise their potential market; and effectively lower debt and legal costs.

ESOS Audits ? Looking Beyond

According to the Department of Energy and Climate Change (DECC), average first audit costs would be estimated at about ?17,000 and subsequent ones at around ?10,000. As expected, these audits will result in energy saving recommendations, of which companies need not proceed for a follow up; and substantially improve businesses in their energy management issues. DECC further states that every business that complies with ESOS could save an average of ?56,400 each year from an initial investment of ?17,000 only.

Currently, up to 6,000 UK businesses are already subject to existing CRC Carbon Reduction Scheme, Mandatory Carbon Reporting, Climate Change Levy and other compliance. This signifies that ESOS may overlap with prevailing energy efficiency legislation and may put additional pressure on energy administration. While this is true, however, ESOS holds extensive benefits. Although the scheme can be viewed as another costly compliance to environmental standards, ESOS goes straight to the bottom line and provides the organisation with competitive advantage. If large businesses act now and comply with it, they will be able to enjoy maximised payback in the long run.

Indeed, Energy Savings Opportunity Scheme is already here. It is mandatory with minimal investment. And all you have to do is act quickly, implement new improvements and earn more.

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Do you really need a Cloud Broker?

A cloud broker is someone who can serve as your trusted adviser when it comes to your dealings with a cloud service provider. Sort of an IT consultant who: is familiar with cloud computing, can negotiate a mutually beneficial relationship between you and a provider, and help you manage usage, performance and delivery of cloud services.?But do you need one?

Is it even time for cloud adoption?

Of course, if you haven’t even started considering moving your IT systems to the cloud, what’s the point of reading this article, right? Well, if you’re running a business in Ireland or the UK maybe you should start thinking about it. The benefits (of moving to the cloud) are simply overwhelming. But then that’s for another post.

For now, let’s just briefly talk about the rate of cloud adoption so far. This should give you an idea what other decision makers nearby think about cloud computing and what they’ve done in this regard so far.

According to research conducted by the Cloud Industry Forum (CIF), the number of first-time users of cloud computing in the United Kingdom has risen by about 27% compared to last year.

The study, which was carried out by research company Vanson Bourne and which involved IT decision-makers from both the private and public sector in UK, also showed that 61% of companies are subscribing to cloud-based services. A similar research conducted last year (2011) revealed only 48%.

In Ireland, plans are underway to adopt cloud computing. According to Pricewaterhouse Coopers, 75% of Ireland’s CIOs and IT directors are already adopting a cloud computing strategy.

Definitely, the number of cloud adopters is growing. If that number already includes your hottest competitor, then perhaps there’s no time to waste.

But while a migration to the cloud should be in your pipeline, it shouldn’t be something you should rush into. Generally speaking, there are at least three kinds of services offered by cloud service providers: IaaS (Infrastructure as a Service), PaaS (Platform as a Service), and SaaS (Software as a Service).

Some providers offer variations of these services. You might only need one type of service or a little of everything. There are also technical and regulatory compliance issues that need consideration.

Obviously, if you have no idea where or how to start, you’ll need someone who can help you. But what kind of help do you need?

Let’s proceed by talking about the kinds of services cloud brokers offer as these are obviously indicative of the needs of current cloud customers.

What cloud brokers do?

Cloud brokers offer three main types of services.

Cloud?inter-mediation

Cloud inter-mediation services are designed to add value to existing services and improve capabilities. ?Examples of cloud inter-mediation include managing access to cloud-based services, carrying out performance reporting, and establishing stronger security.

Cloud aggregation

As mentioned earlier, some cloud customers may end up subscribing to multiple cloud services; most likely from different cloud service providers. To get optimal return on their various cloud subscriptions, these customers will need to apply data integration and make these disparate systems work together. They will also have to make sure data flowing from one system to another is kept secure. This is where cloud aggregation comes into play.

Cloud arbitrage

This entails finding the best cloud service provider(s) to solve a particular problem. One example is comparing different providers offering data storage services and identifying the one offering the most competitive rates.

Other cloud arbitrage brokers develop new solutions by combining the services of different cloud service providers and then offer them to cloud customers. While there are similarities between cloud arbitrage and cloud aggregation, the former is more flexible and allows the customer to transfer from one provider to another where conditions are more favourable.

Problems a cloud broker can help you solve

Just like with natural clouds, your experiences in cloud computing won’t be all white and fluffy. You’ll also encounter gray and uncertain (or even stormy) clouds.

One major issue in cloud computing is cloud security. In fact, cloud security (or the apparent lack of it) is the one thing that’s really clouding up the sky of cloud computing. But that doesn’t mean the cloud is totally insecure. Besides, there are certain types of information that really don’t require a high level of security. These types you can easily migrate to the cloud.

For sensitive information, you really need to conduct due diligence to make sure your cloud service providers’ data centres are secure enough.

Where exactly will your data be stored? Are there enough provisions for regulatory compliance? How will your data be segregated? Does the infrastructure readily support ?data forensics? Is there a sound disaster recovery/business continuity plan? These are just some of the questions that need clear answers before you sign a contract with a cloud service provider.

Suggested reading: 9 Cloud Security Questions You Need To Ask Service Providers

Also, before you sign, you need to study the SLA (Service Level Agreement) very carefully. Look at the guaranteed uptime. Is it enough to meet your own desired service levels?

Bear in mind that the answers to these questions may be too technical. This is one of those instances when a cloud broker can come in handy. As your trusted adviser, your cloud broker can break down the technical jargon and present everything in a language that you can make intelligent decisions from.

A cloud broker will also be able to study the cloud provider’s security architecture and policies and determine whether they’re sufficient to meet your own security requirements. Basically, a cloud broker will not only help you obtain answers to your questions.

He will also know exactly what vital information to extract from providers in order to ensure that you find the best deal possible.

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