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Amazon swells in the UK

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The UK e-commerce market is poised to grow by 110% over the next 10 years, as per IMRG and Capgemini reports, reaching £123bn by 2020. It is said that Britons are enthusiastic online shoppers, owing to a combination of ease, convenience and 24/7 access. More than £300bn has been spent online in the UK since 2000, the IMRG said, with the highest performing sectors over the last 11 years being clothing and electrical. Accordingly, by 2020, the internet should account for half of all retail sales and influence most of the other half.

Latest reports state that online retailing giant Amazon is building a huge warehouse complex on the outskirts of Swansea, covering the equivalent of 10 football fields, to begin operating in October, creating 1,200 jobs as a major expansion of its UK operations. The operation is expected to be fully functional after five years. By then, the Christmas buying spree will have created about 1,500 extra temporary jobs, a veritable respite as, despite a fall of 26,000 in the three months to May 2011, the Chartered Institute of Personnel & Development predicts unemployment to peak in mid-2012, primarily due to the public sector cuts looming in the horizon.

Amazon recently picked up LoveFilm, the leading UK-based home video and video game rental that claims to have more than 1,500,000 members, over 67,000 titles, and 4 million rentals per month across five countries. Amazon also announced it was taking on Tesco, Sainsbury's, and Asda by launching an online grocery store offering "free delivery on thousands of great value household, niche, ethnic and international products", offering a range of 22,000 products. The delivery will be directly from the suppliers which implies shoppers could face separate deliveries for one large shop.

There are talks of bringing brands including PepsiCo , Nestle, Kraft, and Proctor & Gamble to its British customers. Further, in July, Amazon acquired one of its competitors, The Book Depository International, a UK-based online bookseller with over 6 million books for delivery worldwide and one of the fastest growing booksellers in Europe. This would help it expand its reach with an established customer base in Europe and a fulfillment center. Would it make sense for Amazon to make similar moves elsewhere such as in India, where it is looking to expand, and where a takeover of Flipkart, the reigning Amazon of India would augment its profits?

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