Market Overview

Increased public sector purchasing lifts Internet retailer, sees government spend increasing with SMEs


A new Internet business, Zoom Direct, is one of an increasing number of SMEs benefiting from public sector spend, having seen a 125% growth in sales to the public sector resulting from the government's commitment to increase government spending with SMEs to 25% by 2015. This is an extremely promising development for entrepreneurs and the UK economy as a whole, with GDP growth reliant on SMEs. The extra business has enabled the Internet stationery retailer to innovate and grow through access to a larger customer base which was previously inaccessible, and this trend will be reflected across the SME sector as a whole.

(PRWEB UK) 19 November 2012

The online stationery retailer, Zoom Direct has benefited from the coalition's target to increase the share of public sector spending with SMEs. It has seen a 125% growth in sales to councils, universities and other government bodies and sales of school stationery in the last 6 months, which is becoming an increasing trend. Sales to local government continues to be on the increase with government sales constituting a growing proportion of revenues.

Managing director, Nick Trinnaman: “We have seen a marked increase in public sector purchases on the website, which is a trend that provides some welcome good news for retailers. The government's commitment to increase public sector purchasing with SMEs is definitely paying dividends by allowing businesses such as ours to grow where previously we would have been shut out of purchases as they had to buy centrally from specific businesses or publications. We believe they've been told to shop around for the best price. David Cameron is correct that the future of the economy and growth lies with small business and we are happy to be the ones helping bring Britain back to growth.”

The coalition came to office with the commitment to increase central government spending with SME's to 25% by March 2015, with the government considering it to be vital to the economy and promoting growth. Zoom Direct, which is a large stationery supplier to schools, universities and government as well as business stationery via the Internet is typical of the increasing trend in SMEs successfully competing for government contracts and procurement spend. Since then the sentiment in the industry and amongst business contacts has changed dramatically with many experiencing government purchasing finally opening up to smaller and medium sized enterprises. New businesses are also starting to compete successfully for government procurement spend.

Managing director, Nick Trinnaman: “The bulk purchasing from government as well as businesses has definitely been a great benefit to our business strategy, as we have geared our business towards supplying large quantities with volume discounts. Key to our business is having and holding all items in stock one hundred percent of the time so customers always know that what they order is actually available and will be shipped the same day, in contrast to the common perception forming of online retailers. Companies such as ours that offer this kind of service to government buyers will continue to benefit from the opening up of government buying.”

The intent of the government's measures is to support small business and new innovation, the traditional drivers of GDP growth, and there could not be much of a better example of this than Internet retailers. Zoom Direct has promoted an innovative business model by bringing the traditional B2B stationery purchasing activity online, an environment dominated by B2C retailers, and offering end customers quantity discounts with graded price breaks, something which is rarely available to the end consumer. While government purchasing is perhaps a perfect match for this company's business strategy, small businesses all over are starting to benefit from a larger customer base previously inaccessible to them, and this an extremely promising development for entrepreneurs and the UK economy as a whole.

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