High Street woe as web sales grow

Broadband internet connections are boosting online shopping

High Street stores will lose market share to their online rivals as more households take broadband internet connections, according to a report.

By 2010, 6% of UK consumer spending on goods and services will be done online, said the study from money transfer site Paypal Europe.

It said people will be spending £18.5bn a year on the internet which would previously have been spent in stores.

Online shopper numbers will rise 10 million to 25 million by 2010.

Electrical stores

With 66% of homes likely to have broadband access by then, Paypal suggested, online shopping would become quicker and easier.

"Over the past few years we have seen the internet gradually eating away at the high street," said chief executive Geoff Iddison.

"By 2010 we expect substantial sums that would have been spent on the High Street to have moved online."

The report warned that electrical retailers faced a growing threat from online rivals, with online stores set to take £4.6bn per year by 2010, a surge of 136%.

Food and grocery items are estimated to make up 30% of online shopping by 2010, up 235% on 2005.

Online sales of DIY goods are due to rise by 172% between 2005 and 2010, with clothing and footwear growing 160% over the same period.