Home shopping via the internet does not pose an immediate threat to the survival of traditional high street stores or out-of-town retail units, according to risk managers. The survey of AIRMIC members operating in the retailing sector also found that risk managers believe that over 90% of the public fail to understand the risks associated with e-tailing, and that over 60% of retail management does not fully understand them either.
Paul Howard, chairman of AIRMIC's retailers special interest group, said: "While the overwhelming majority of our members believe their companies can benefit from e-tailing, the view at this moment is that traditional methods of buying and selling are not under threat. The extent of the impact will depend on the industry sector. With a pair of shoes, people still want to see them in the shop and try them on. They want to be able to rely on the expertise of the shop assistant.
"But the success of companies like Amazon has proved that you can be successful selling things like books and CDs on the internet, and I believe that, as distribution mechanisms and technology become more sophisticated, e-tailing will become a key part of many areas of the retail sector."
According to members of the SIG, the main risks faced by companies selling on the internet are loss of reputation, falling customer service standards and fraud, although competitor activity is also regarded as a major threat. In addition the survey results show that 70% of respondents believe that the compensation culture has become more evident in the retail sector in the past year - which could have knock-on effects with regard to e-tailing. More than 90% regarded the trend towards 'blame and claim' as either a medium or a major risk to retailers.
