Representatives from the hardware industry are going bug-eyed at e-commerce prospects from consumers who will spend an estimated $61 billion online in 2000, an incredible 85 percent increase over the previous year.

A series of programs under the heading "Clicks and Mortars" drew large audiences at The National Hardware Show and Building Products Exposition held in Chicago Aug. 13-16. According to the Home Improvement Research Institute (HIRI) in January, nearly 24 percent of homeowners reported using the Internet to buy home improvement products, a 32 percent increase over the same level measured in June 1999 and a staggering 118 percent higher than the year-ago period. HIRI projects even higher numbers in the future.

HIRI's study also confirmed that almost twice as many homeowners researched home improvement products on the Internet than actually bought them. Hardware industry representatives thought that a positive development that leads to greater product education and ultimately boosts home improvement sales. Industry experts noted that the rising tide of e-commerce threaten the traditional distribution chain, especially squeezing out small- and medium-size businesses.

Yet, studies by the Gartner Group and Forrester Research predict a massive e-tailing shakeout over the next two years. Both research firms expect more than half of the e-tailers in existence today to be out of business by the end of 2001.