The relevance of e-commerce to UK business: development and survival in a changing business environment

When historians look back at the opening years of the 21st century, they may well conclude that the introduction of e-business techniques represented change on a scale directly comparable to the introduction of electrical power at the end of the 19th. Over the past 12 months (1999-2000), awareness of the potential importance of e-business has risen dramatically in the UK, both in business-to-business (B2B) and business-to-consumer (B2C) applications. According to IDC, UK B2B revenues are expected to reach #28 billion in 2002: some 4% of UK GDP. According to Ernst and Young, B2C may provide 24% of all UK retail sales by the same date. The implementation of e-business is reducing overall inflation. It is also likely to increase long-run sustainable growth in the UK economy by up to 0.5% per annum for the next ten years. Many companies are now exploring how these tools can make their existing business more efficient, by improving customer service, reducing inventory, enhancing quality and speeding up time to market. For most businesses, however, this represents only the first step in a process that may ultimately transform the nature of the business itself. It may lead to radically new types of product or service, new means of financing and novel charging methods.