TEMECULA, CA—Some 8.3% of total retail sales comes from e-commerce. That, at any rate, is the common wisdom. But citing an ICSC report, Brian Bielatowicz, a Lee & Associates SVP and founder of the firm's Temecula Valley Retail Group, believes that brokers are smart to peak behind the curtain of the statistics.

“There seems to be a misconception of how internet sales are overtaking brick and mortar,” he says. While smart retailers are adapting their traditional business models to include what he sees as a very effective sales tool, the impression that brick-and-mortar retail is going the way of the dinosaur is a bit overstated.

“The problem is how to break down and understand those sales figures,” he notes. “That's where the misconception lies.” The reality is that the total percentage of pure-play e-commerce business is closer to 3.3%, says Bielatowicz.

Why the discrepancy? The SVP points to three prime areas of statistical inflation: First, there's “mail-order sales and the online transactions of brick-and-mortar retailers,” he says, which account for 34% of the 8.3% e-commerce total.

“Then you need to factor in non-merchandise receipts, which include non-refundable shipping and handling, auction commissions, customer training and advertising.” This accounted for an additional 7.6% of the e-commerce total, according to ICSC. “None of these correspond to physical goods, so should be excluded from pure e-commerce sales.”

Finally, omni-channel sales are also a large factor in the performance of e-commerce, weighing in at 35% of the total. Taken altogether, the total pure-play e-commerce activity reduces to 3.3% of the $4.708 trillion retail business.

Bielatowicz calls Amazon the 800-pound gorilla in the e-commerce world. And indeed with 2015 sales of $63.7 billion, it's obviously the prime (you should excuse the pun) web-based player. But as the SVP points out, even Amazon is blending its clicks with bricks as more Amazon stores pop up, but it still can't compare to “brick-and-mortar stores like Walmart at $482 billion and CVS at $153 billion.”

But none of this is to naysay the power of internet sales and, other than a CVS or a Walmart, who wouldn't want to do $63.7 billion in sales? In five or 10 years, says Bielatowicz, we can expect to see the continued growth of e-commerce and “significant changes with regards to more online retailers building brick-and-mortar stores.

“We're starting to see that happen now,” he continues, with pure-play e-retailers querying Lee & Associates on pop-up stores in major markets such as L.A. and New York City. He also expects an increase in brick-and-mortar retailers snatching up online players, just as Walmart recently purchased Bonobos and Modcloth, increasing both its overall revenues and online presence.

“There's a lot of morphing that's going on right now,” says Bielatowicz. “We're in a revolutionary time.”

TEMECULA, CA—Some 8.3% of total retail sales comes from e-commerce. That, at any rate, is the common wisdom. But citing an ICSC report, Brian Bielatowicz, a Lee & Associates SVP and founder of the firm's Temecula Valley Retail Group, believes that brokers are smart to peak behind the curtain of the statistics.

“There seems to be a misconception of how internet sales are overtaking brick and mortar,” he says. While smart retailers are adapting their traditional business models to include what he sees as a very effective sales tool, the impression that brick-and-mortar retail is going the way of the dinosaur is a bit overstated.

“The problem is how to break down and understand those sales figures,” he notes. “That's where the misconception lies.” The reality is that the total percentage of pure-play e-commerce business is closer to 3.3%, says Bielatowicz.

Why the discrepancy? The SVP points to three prime areas of statistical inflation: First, there's “mail-order sales and the online transactions of brick-and-mortar retailers,” he says, which account for 34% of the 8.3% e-commerce total.

“Then you need to factor in non-merchandise receipts, which include non-refundable shipping and handling, auction commissions, customer training and advertising.” This accounted for an additional 7.6% of the e-commerce total, according to ICSC. “None of these correspond to physical goods, so should be excluded from pure e-commerce sales.”

Finally, omni-channel sales are also a large factor in the performance of e-commerce, weighing in at 35% of the total. Taken altogether, the total pure-play e-commerce activity reduces to 3.3% of the $4.708 trillion retail business.

Bielatowicz calls Amazon the 800-pound gorilla in the e-commerce world. And indeed with 2015 sales of $63.7 billion, it's obviously the prime (you should excuse the pun) web-based player. But as the SVP points out, even Amazon is blending its clicks with bricks as more Amazon stores pop up, but it still can't compare to “brick-and-mortar stores like Walmart at $482 billion and CVS at $153 billion.”

But none of this is to naysay the power of internet sales and, other than a CVS or a Walmart, who wouldn't want to do $63.7 billion in sales? In five or 10 years, says Bielatowicz, we can expect to see the continued growth of e-commerce and “significant changes with regards to more online retailers building brick-and-mortar stores.

“We're starting to see that happen now,” he continues, with pure-play e-retailers querying Lee & Associates on pop-up stores in major markets such as L.A. and New York City. He also expects an increase in brick-and-mortar retailers snatching up online players, just as Walmart recently purchased Bonobos and Modcloth, increasing both its overall revenues and online presence.

“There's a lot of morphing that's going on right now,” says Bielatowicz. “We're in a revolutionary time.”