29% of German ecommerce generated by small businesses
29 percent of German ecommerce sales are generated by small businesses with fewer than 10 employees. Compared to the situation in the entire German economy, small ecommerce enterprises are much more important for the total turnover in their sector.
In 2018, small businesses (companies with up to 9 employees) accounted for just 6.6 percent of the non-financial commercial economy in Germany. But when we look at ecommerce in Germany, the situation is totally different. There, these small enterprises account for 29 percent of generated sales.
Because of low investment costs
As Shopanbieter explains, this is because of the comparatively low initial investment that’s required to start an online store. “One-man entrepreneurs and start-ups don’t have to open a physical store. They hire only a few staff, if desired, they can even outsource the logistics from the start, and they still can develop a flourishing online business”, the German website explains.
‘If sales grow, so do the costs’
But Shopanbieter also explains how the problems for ecommerce businesses can come later. “If sales grow, so do the costs. More warehouse storage space is needed and the growth in sales can only be met with higher marketing expenses. This requires more staff, and at the same time growth is gradually weakening. And before you know it, you are caught in the growth trap.”
Part of Bevh study
The news about 29 percent of ecommerce sales in Germany generated by small businesses, comes from a comprehensive study done on behalf of ecommerce association Bevh. It shows the impact of ecommerce in Germany. For example, every year, online retail contributes 100 billion euros to German GDP thanks to its 1.2 million direct and indirect employees.
This corresponds to a share of 2.9 percent. That’s over half of the share of the German automotive industry (which accounts for 4.9 percent of German GDP). Shopanbieter: “No wonder that the Bevh is demanding more recognition for the ecommerce industry from national politics.”
No wonder that Bevh wants more recognition for the ecommerce industry.