Cypriot businesses with online sales up 211% in 5 years

A recent study conducted by CyStat has shown the digital economy in Cyprus to be growing rapidly.

The number of people searching for information about products or services has grown from just 190,000 back in 2008, to over 500,000 in 2020. That means that well over half of the population are now using the internet to search for products and services.

Accordingly, the number of businesses with online operations has also increased dramatically. In 2015, businesses with website or in-app sales (where you can actually make a purchase online, not just find out information) numbered just 310. By 2020, this figure had more than doubled to 656 – a 211 per cent overall increase.

But even within this figure, there is an interesting pattern. The number of businesses that receive a significant portion (over 25 per cent) of their turnover from online sales has increased by over 400 per cent, indicating the emergence of an environment that is progressively more accommodating to businesses that operate predominantly online. The pandemic has undoubtedly catalysed acceleration of this change, with some new restaurants now relying solely on internet orders.

Dimitry Usov, a resident of Limassol who recently opened three restaurants, including the popular ‘Hollywood Burger’, that offer only delivery through the ‘Bolt food’ app told the Cyprus Mail that for those willing to adapt, the digital economy can offer great opportunity.

‘We didn’t have to hire waiters, or rent a large area with parking. Yes, our revenue relies only on online orders, but bearing this in mind with our original business plan, we were able to dramatically reduce overheads,” he commented.

Electronic signatures – a legal way to get consent or approval on electronic documents or forms, are of rising importance in the usage of e-government services. However, the study points out that not all Cypriots are comfortable yet using e-signatures, and hence a rising number of people turning to consultants for help. The study asked businesses that were not submitting documents online why this was the case,  and the most common reason was that somebody else, either a consultant, accountant or associate was submitting the documents on their behalf.

Also mentioned were ‘problems utilising an electronic signature’ and ‘concern for protection and security of personal data’, which was cited by 14 per cent of companies.

In the European Union’s Digital Economy and Society Index (DESI) for 2020, Cyprus ranked 17 out of 29 countries in an all-things-considered digital economy index, slightly below the EU average. While Cyprus ranked 15 for overall internet usage, it ranked 4 from last in the domain of internet transactions, ahead of only Greece, Bulgaria and Romania.

This may owe something to the fact that Cyprus is small and people have not begun relying on deliveries to the same extent that they have in other nations. Underlying everything, Cyprus ranked 2nd   from last for overall connectivity, ahead of only Greece, and came in dead last on the broadband price index.

To facilitate continued digitalisation of the economy in coming years, it is evident that improvements in the performance and value of broadband connectivity must be a priority for Cyprus. Much of this kind of improvement is proposed by the government for the European recovery fund projects.