Online retailing may be a last resort for smaller retailers who are gradually being squeezed out of the market by diminishing margins, according to retail consultancy Verdict. A five year retail forecast ­ Retailing 2004 ­ reveals a decline in consumer expenditure on food from 42.4% in 1999 to 40.6% in 2004. Wal-Mart is blamed for the impact on the nation's supermarkets and retail industries. But the main areas affecting this shift are changes in demographics due to an ageing population; the increasing use of internet shopping; planning constraints on out of town developments; and the polarisation of shopping centres. The overall result will be a shift in the economics of food retailing which will result in a drop in the number of small retailers. Verdict says there are substantial opportunities to grow what is an underdeveloped market, currently worth £36bn a year. Mike Godliman, a director at Verdict, said: "The trend is definitely about scale, and small retailers will have to differentiate to survive. Online retailing will help them to massively increase their market size while also serving their local area." And, he said, in order for smaller retailers to beat back the multiples they had to concentrate of added value services. {{NEWS }}