"Adoption of Internet Business Solutions and e-Business leads to an average increase in revenues of 7%, a decrease in costs (COGS) of 9.5% and a decrease in sales costs (SG&A) of 7.5%."
"A firm with C$10M in revenues, with a 20% gross margin and 10% net margin, could achieve increases in net profit of up to 154% with those improvements in revenue and costs."
Source Canadian e-Business Initiative - Fast Forward 4.0 Growing Canada’s Digital Economy - May 2003
Business-to-Business Rules
- Globeinvestor Gold
- ROMA LUCIW
- November 2005
While the term on-line sales may evoke images of people buying Christmas presents on eBay, a new Statistics Canada study shows the Internet has had its biggest impact on the flow of goods between businesses.
"The vast majority of gains in e-commerce during the past few years have been the result of increased sales from one business to another, not sales from businesses to households," Statscan said in a report issued Wednesday. The study also found that the pattern of on-line sales has not shifted much in the past four years.
In 2004, on-line sales by private Canadian companies reached $26.5-billion, with sales from business to business accounting for 75 per cent of this total, the study found. That percentage was roughly the same in 2000.
The Statscan findings were based on data from 17,000 enterprises collected in the 2004 survey of electronic commerce and technology.
The government study compared on-line sales from retailers to consumers to that of two large business-to-business sectors: manufacturing and wholesale trade. These three account for just over half of all on-line sales by private companies in 2004.
Manufacturers sold $4.2-billion in goods over the Internet in 2004, of which 94 per cent was to other businesses. Among wholesalers, business-to-business sales accounted for 84 per cent, or around $5.1 billion, of their on-line sales.
"Companies that buy and sell on the Internet may potentially be able to manage their inventory more efficiently, get goods to markets faster, reduce the cost of paperwork, and get lower prices on some supplies," Statscan said.
The retail sales sector sold close to $3-billion of goods and services on-line last year, the survey found. The vast majority of these retail e-commerce sales, 85 per cent, were to households and individuals, a proportion that was virtually unchanged from 2003.
There are, however, signs that sales on the Internet will "become a more important facet of retail trade," Statscan said. In 2004, on-line sales by retail firms grew by 51 per cent from a year ago.
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