Role of Ecommerce in SME (Small and Medium Enterprise) Growth



What is Ecommerce?

Ecommerce is the sell and purchase of goods and services through electronic channels like Internet.

What are SMEs?

SMEs are the small and medium enterprises in the sectors of manufacturing, food processing, pharmaceuticals, textiles & garments, retail, IT, agro, engineering precision etc.

SMEs are considered extremely vital for a nation, whether developed or developing. It is considered as the backbone of a country’s economy or an engine for the nation’s economic development. Major reasons behind this generalisation is that it generates tonnes of industrial outputs, provides revenue from exports, generates employment which is very important factor for developing countries with large number of population below 40.

Now, you may think, what is the role of e-commerce in SMEs? How they can help each other?

We have mentioned in previous blogs that growth of e-commerce has been huge, thanks to the new enabling technologies and platforms. Use of the internet and various smart digital devices has been on tremendous rise, eventually leading to e-commerce boom. This has given a fresh new possibility for the SMEs to establish and grow themselves. Many have taken the e-route to not only use as a marketing tool but also to identify the markets and even to test their innovative products before launching them in the competitive market. Hence e-commerce can help SMEs in being the strategic marketing and brand establishment channel, spread the customer base on global level and increase competence. On the other hand, SMEs has to understand and utilise the power of the new emerging technologies in various business function such as manufacturing and as well as logistics and payments.

Let us understand various benefits of ecommerce for SMEs

Key factors



Revenue increase:

SMEs in the traditional scenarios have extremely domesticated market. Their geographical reach is limited either by constraints of costs or lack of technology services. But with the ecommerce aid, the same SMEs can have higher revenues by increased reach not only within country but also internationally. Their customer base is increased by wider promotion which leads to higher sales. More and more products are exported and that leads to high amount of revenue generation. In addition, business done online gives speed and flexibility to the way businesses are conducted.

Wider Geographical Reach across different Time zones:

With internet technologies and smart devices, accessibility has become easier across different time zones. Difference in time is no longer a constraint for business transactions. World is extremely getting savvy to working in different time zone from any part of the globe providing 24X7 accessibility. Internet also has diminished the geographical boundaries and business can gain buyers and seller across the world. This enhances their competitiveness within the country as well as internationally. Each and every business gets the global platform to establish and grow.

Rise in Profit Margins:

With low investments, businesses can launch their products on online market places or have their own online storefront. In comparison to their investments, returns are high in terms of geographical reach and gaining more customers around the world. This leads to high sales and ultimately high profit margins. With internet technologies, SMEs can even directly engaged with consumers without any middle agencies or people, which reduces the cost further.

Better Consumer Experience:

Ecommerce witnesses fierce competition among businesses. Hence they equip SMEs with ecommerce portal which is ready to face the competition and provide customer satisfaction. They use various tools and technologies to stay connected with their customers and provide services to the customers which quick and reliable. So the businesses are turning more customer centric which is healthy as it leads to producing more and more competitive products.

As we listed that there are numerous benefits if ecommerce channel is used by SMEs in any country. Many countries are leveraging the benefits which has helped SMEs and eventually their respective economies. A proper ecosystem has to be developed which helps SMEs leverage the potential of ecommerce. There has to be awareness, training and proper financing by which promoters can understand the powers of various emerging technologies. Even the Government plays a pivotal role in the ecosystem. In our country India, they are trying to boost the ecosystem by launching various missions like Digital India, Make in India and Skill in India. It is crucial for ecommerce giants to incorporate role of SMEs and fuel to the economic growth of the respective countries.

Mart2Web is an ecommerce application, which is designed considering the growth of their clients. It eliminates all the constraints of payments, time, currency, location and provides an impressive storefront to showcase your innovative products. It brings you the finest and latest technologies in your hands to leverage its power for your success.

Author: blogmart2web

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