Census Bureau: Business-to-Business Dominates E-Commerce.

Business-to-business activity accounted for a significant share of overall e-commerce, with manufacturing ($485 billion in shipments ordered online) overshadowing business-to-consumer transactions such as retail trade ($15 billion in online sales) for 1999, according to the first official e-commerce statistics for several key sectors of the economy from the Commerce Department’s Census Bureau.

E-commerce accounted for 12 percent of the total value of all manufacturing shipments in 1999, while merchant wholesale trade achieved 5.3 percent of its sales through online transactions. E-commerce accounted for less than 1 percent of selected service industries’ revenues and retail trade sales.

“Almost all industry groups are engaged in e-commerce to some degree, but a significant portion of the total e-commerce dollar value is concentrated in a handful of industry groups,” said Frederick T. Knickerbocker, the Census Bureau’s associate director for Economic Programs.

In manufacturing, five groups (transportation equipment, computer and electronic products, chemicals, machinery and food products) accounted for 63 percent of the dollar value of all e-commerce shipments. In merchant wholesale trade, three industry groups (drugs and druggists’ sundries; motor vehicles, parts and supplies; and professional and commercial
equipment and supplies) accounted for 75 percent of merchant wholesale sales online. In selected service industries, four groups (travel arrangement and reservation services, securities and commodity contracts intermediation and brokerage, publishing industries and computer systems design and related services) accounted for 60 percent of e-commerce revenues. In retail trade, one industry group (electronic shopping and mail-order houses) accounted for 76 percent of e-commerce sales.

E-commerce was most prevalent in manufacturing. Five groups in manufacturing had e-commerce shipments that accounted for 15 percent or more of the industry group’s total shipments, led by transportation with 21 percent. Only two groups — wood products and petroleum and coal products — had e-commerce shipments that accounted for less than 5 percent of their total shipments.

The e-commerce data were collected in four separate Census Bureau surveys, which collected the value of goods and services sold online through open networks such as the Internet or over proprietary networks running systems such as Electronic Data Interchange.

The E-Stats report (released March 7) comes one year after the Census Bureau released its first estimates of retail online sales. The Census Bureau’s recent estimates of e-commerce retail sales for 2000 are not directly comparable to the 1999 data released today because of differences in classification.

Other highlights from the report:

– In merchant wholesale trade, the leading industry groups in online sales were drugs and druggists’ sundries (32 percent of the group’s total sales); motor vehicles, parts and supplies (17 percent); and professional and commercial equipment and supplies, and hardware, plumbing and heating equipment and supplies (8 percent each).

– For selected service industries, the four top industries in terms of percentage of total sales via e-commerce were travel arrangement and reservation services (21 percent), securities and commodity contracts intermediation and brokerage (15 percent), publishing (12 percent) and computer systems design and related services (11 percent).

– In the selected service groups, the travel arrangement and reservation services industry was the online leader with e-commerce accounting for 21 percent of total revenue.

– In retail trade, electronic shopping and mailing order houses accounted for three-fourths of total retail sales via e-commerce. The leading e-commerce merchandise categories within retail trade were computer hardware (37 percent of total industry e-commerce sales) and books and magazines (14 percent).

The Census Bureau report called E-Stats covers about 70 percent of the economic activity measured in the 1997 Economic Census. The report does not cover agriculture, mining, utilities, construction, nonmerchant wholesalers and about one-third of service-related industries.

Data are from the 1999 Annual Survey of Manufactures’ Computer Network Use Supplement, Annual Retail Trade Survey, Annual Trade Survey and Service Annual Survey.

The data are subject to sampling variability and nonsampling errors. Sources of nonsampling error include errors of response, nonreporting and coverage. Measures of sampling variability, presented as relative standard errors, are shown in tables in the report.

For more information at http://www.census.gov