A force no investor can ignore –SMEs and e-conomy

The evolution of information technology has been a game-changer in every walk of our life. Talking about business, Indian SMEs have come out of traditional ways of operating. By modifying their activities and trading globally through e-commerce, SMEs have seen extensive business growth. The usefulness and significance of e-commerce should not be ignored by SMEs and the reason being that the absence of a virtual presence can hamper your business. While all your potential customers and clients are turning more towards technology, ignoring it can make your survival difficult. One of the most basic problems that SMEs face is a centralized database for tracking the customers. This leads to a difficulty in efficient communication and marketing activities. e-commerce helps in simplifying this problem and act as a catalyst in business expansion. All one needs to do is grab the opportunities it brings. 

e-commerce still remains in an early stage of development due to the low Internet penetration in comparison to the traditional channels. It is positive as it implies there a lot of room for growth. Tier 1 cities see a success when it comes to e-Commerce as Internets services are readily available and above all companies are equipped to use them in their day to day operations. We should also expect a rapid growth in Tier 2 and Tier 3 cities as well. As a matter of fact, a lot of platforms already help small businesses in identifying trade partners from all over the globe. They can list their products, connect with suppliers and buyers both domestically and globally, sell all kinds of products, etc. In addition to it, they also provide information on the top trade trends and resources, industry news, national and global trade shows, etc. The businesses’ have to be encouraged to adopt e-commerce and show how valuable the Internet can be.

India has a good small business population along with a strong domestic market and a growing export sector. India is looked us a strong market with a prime focus being on Tier 1 and Tier 2 cities to get online. We need to understand not only the factors that facilitate the e-commerce adoption, but also the post-adoption benefits. Benefits like an increased market reach, improved sales numbers, better external communication, improved brand image, and overall increased productivity are the post benefits that we are talking about. As per a lot of research papers, basic features like e-mail, websites, Internet, intranet, extranet, Electronic Data Interchange (EDI), Electronic Fund Transfer (EFT), barcode, etc. are the most relevant to SMEs. 

Some potential benefits to SMEs:

Increase in revenues: You can now conduct the business activities transcending geographical barriers which result in the increase in the customer base, sales, and revenue. Added features like prompt feedback and referrals are like a cherry on the cake.

Low Marketing and Distribution Cost: Businesses spend heavily on traditional mediums. e-commerce helps in reducing the marketing cost and the heading of opening and managing stores at multiple locations.

Increase in Profit Margin: A better pricing strategy can be developed when a business can manage logistics, packaging and, warehousing online. A competitive pricing strategy has a positive impact on the profit margins.

Better Accessibility and Geographical Reach: Your business can go 24*7 without any geographical and time zone limitations. 

Faster Approach to Market: By cutting down the time frame in bringing the product to the customer before your competitor does can do wonders! The communication process can be streamlined by reaching to the customer as quickly as possible.

Better Experience for the Customers: In today’s world the customer is like a demanding queen and e-commerce surely helps in giving a better experience to the customers. Quick response to the customer queries, better after-sale services, an interactive platform which gives information as every step builds the base for loyal and lifetime customers which later become your brand advocates.

Thus, it is a time when we make India a business-friendly place and use technology to leapfrog to bridge the gap between the demand and supply. Interestingly, the investment cost of starting and running a company has reduced significantly from $100,000 to as low as $10,000-$15,000. Entrepreneurship is on sharp rise India and the young blood is thinking beyond the conventional domains. So use this force which no investor can afford to ignore!

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