One in six SME e-retailers are planning to build a physical store presence in 2014 as online competition increases, according to a recent Royal Mail survey.

Of the 400 UK SME online retailers that were surveyed, it was found that 16 per cent expected to open their own store or seek space in an existing store to increase sales. On top of this, 15 per cent said they were planning to expand by using online marketplaces at some point this year.

Over 40 per cent of those asked also said they were planning to use new channels to increase trade in the next year. Over half (56 per cent) said they were confident of sales growth in 2014, although this figure has dropped by eight per cent from last year.

Competition for online shoppers is more intense now than it was last year, according to over half of the respondents, with an increase in the volume of websites being accredited as the reason for this.

Nick Langdon, MD of Royal Mail Parcels, said: “UK SME online retailers are thinking carefully about how they can develop their businesses during 2014. They are concentrating on exploiting as many channels to market as possible, adding space in physical premises and online marketplace listings to complement their existing web channel. In addition, they are concentrating on how to price competitively while increasing the range and quality of their goods.”