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Electronic shopping is booming

Date posted:  6/26/14 01:00:00 PM If your small business doesn't offer online shopping, you might be missing out.

If your small business isn't offering online or mobile shopping, you might want to reconsider.

Electronic shopping continues to grow at a swift pace, outracing the rest of the retail trade sector by a wide margin, according to data from the U.S. Census Bureau. The rate of establishments offering electronic shopping grew 27.4 percent between 2011 and 2012.

"Unlike traditional stores, which are located throughout the country, online shopping establishments and jobs are in concentrated areas," said William Bostic Jr., the Census Bureau's associate director for economic programs.

The number of electronic shopping‡ and mail-order establishments increased from 23,697 to 30,185 between 2011 and 2012. During that time, employment in those sectors jumped 13.7 percent to 365,508. It's a stark contrast from the rest of the retail trade sector, which encompasses "brick and mortar" stores. The number of traditional stores increased just 0.1 percent with employment up 0.7 percent during that time.

The rapid growth of businesses offering electronic shopping helped the U.S. reverse a four-year decline. Businesses with paid employees increased by more than 77,000 establishments, according the Census Bureau. There were 7.4 million U.S. businesses with paid employees in 2012, a 1.1 percent jump from 2011.

Electronic shopping by the numbers
The largest employment increase in electronic shopping and mail-order houses were seen in counties within Southern California, the New York metro area and the Chicago metro area. Other places with strong showings included Memphis, Tennessee; Las Vegas; Grand Rapids, Michigan; Columbus, Ohio; and Minneapolis.

The county with the largest percent increase in electronic shopping establishments was Travis County, Texas, which encompasses Austin. That county recorded a 4.2 percent gain of 1,206 new establishments.

Meanwhile, Hennepin County, Minnesota, had the largest employment rate increase. Hennepin County, which includes Minneapolis, posted a 6.6 percent employment increase in the sector, which came out to 52,844 workers.

What to do with your business
But what if your small business isn't appropriately situated to start an online shopping market? The best thing you can do is increase foot traffic‡ to your store, according to Bloomberg. But that can be a tricky subject to broach.

It's especially hard for retailers to build a successful business when they are on second floors or around hard-to-see corners from main shopping streets or outlets. For most consumers, out of sight is out of mind, meaning businesses in hard to see places are out of luck for most foot traffic.

"The principle at retail is, 'If it is not seen, it is not there,'" retail consultant Herb Sorensen told Bloomberg. 

Sorenson said business owners can overcome a bad location if you store supports online shopping. But he said if your store doesn't have an online outlet, you'll need to take charge of the situation and lack of foot traffic.

In order to do that, you'll need to improve your advertising. Try to make sure that you're identifying your target audience and giving your best customers incentives to write reviews about you on Yelp and other online review sites. More people than ever are reading and exchanging stories on these review sites, which can greatly spread word of mouth about your company.

If you can, you'll also want to sell products that are otherwise unavailable or hard to find in your local market.

Michael Wippler, a business and real estate lawyer and managing partner at Dykema in Los Angeles, told Bloomberg networking is also key.

"Look to your landlord for help with advertising fliers and see if you can't direct cross traffic or pool advertising funds with some of the other retailers nearby," he said.