III. E-COMMERCE AND SMALL ENTREPRENEURS
III. E-COMMERCE AND SMALL ENTREPRENEURS
around 30 per cent of GDP, most importantly distribution, finance, and business services
(Pérez-Esteve and Schuknecht, 1999). E-commerce is also likely to boost international
flows of many services significantly10. At present the biggest volume of electronic trade by
far is business-to-business (B2B), mainly involving big firms setting up online exchanges
to buy industrial inputs, such as steel, chemicals, or car components. A recent Goldman
Sachs report estimates that firms’ possible savings from purchasing over the Internet vary
from 2 per cent in the coal industry to up to 40 per cent in electronic components11. Yet
some of the biggest potential gains from B2B may lie in smaller firms’ purchases of indirect
inputs, such as telephone services, office equipment and furniture, and electricity, which
together account for 30-60 per cent of firms’ total non-labour costs. By pooling the buying
power of small businesses, online intermediaries can negotiate discounts. And by making
the procurement process more efficient, they can also cut processing costs12. The businessto-
consumer (B2C) segment is the second-largest form of e-commerce, embracing normal
retail activity on the Web, such as Amazon.com. A third type of market is consumer-toconsumer
(C2C), which covers auction sites, while a fourth — consumer-to-business
(C2B) — involves reverse auctions, taking advantage of the power the Internet gives to
customers to drive transactions (e.g. with airlines competing to give travellers best offers
on tickets). Finally, business-to-government (B2G) e-commerce refers to the use of the
Internet to move public procurement, licensing procedures, etc., online.
There are at least four different channels through which e-commerce may impact on
developing country entrepreneurs:
i) making it easier for artisans and SMEs to access B2C world markets;
ii) facilitating activity on the global market for agricultural and tropical products;
iii) allowing firms in poorer countries to tap into the B2B and B2G supply chains; and
iv) allowing service-providing enterprises in developing countries to operate more
efficiently and to provide certain services directly to customers anywhere in the world.
OECD DEVELOPMENT CENTRE
Working Paper No. 164
E-COMMERCE FOR DEVELOPMENT: PROSPECTS AND POLICY ISSUES
by
Andrea Goldstein and David O’Connor
III ECOMMERCE AND SMALL ENTREPRENEURS - To learn more about this author, visit OECD Development Centre's Website.
Like this article? Share it with your friends
The share of value added that potentially lends itself to electronic commerce represents
around 30 per cent of GDP, most importantly distribution, finance, and business services
(Pérez-Esteve and Schuknecht, 1999). E-commerce is also likely to boost international
flows of many services significantly10. At present the biggest volume of electronic trade by
far is business-to-business (B2B), mainly involving big firms setting up online exchanges
to buy industrial inputs, such as steel, chemicals, or car components. A recent Goldman
Sachs report estimates that firms’ possible savings from purchasing over the Internet vary
from 2 per cent in the coal industry to up to 40 per cent in electronic components11. Yet
some of the biggest potential gains from B2B may lie in smaller firms’ purchases of indirect
inputs, such as telephone services, office equipment and furniture, and electricity, which
together account for 30-60 per cent of firms’ total non-labour costs. By pooling the buying
power of small businesses, online intermediaries can negotiate discounts. And by making
the procurement process more efficient, they can also cut processing costs12. The businessto-
consumer (B2C) segment is the second-largest form of e-commerce, embracing normal
retail activity on the Web, such as Amazon.com. A third type of market is consumer-toconsumer
(C2C), which covers auction sites, while a fourth — consumer-to-business
(C2B) — involves reverse auctions, taking advantage of the power the Internet gives to
customers to drive transactions (e.g. with airlines competing to give travellers best offers
on tickets). Finally, business-to-government (B2G) e-commerce refers to the use of the
Internet to move public procurement, licensing procedures, etc., online.
There are at least four different channels through which e-commerce may impact on
developing country entrepreneurs:
i) making it easier for artisans and SMEs to access B2C world markets;
ii) facilitating activity on the global market for agricultural and tropical products;
iii) allowing firms in poorer countries to tap into the B2B and B2G supply chains; and
iv) allowing service-providing enterprises in developing countries to operate more
efficiently and to provide certain services directly to customers anywhere in the world.
OECD DEVELOPMENT CENTRE
Working Paper No. 164
E-COMMERCE FOR DEVELOPMENT: PROSPECTS AND POLICY ISSUES
by
Andrea Goldstein and David O’Connor
III ECOMMERCE AND SMALL ENTREPRENEURS - To learn more about this author, visit OECD Development Centre's Website.
Like this article? Share it with your friends
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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John AlexanderJohn has taught keyword research and SEO skills to small groups of business owners and Webmasters from over 80 different countries world wide since 2002. John is also the Director of Search Engine Academy ; Co-director of Training at Search Engine Workshops offering live, SEO Workshops with his partner SEO educator Robin Nobles, author of the very first comprehensive online search engine marketing courses at SEO Training Online and the SEO Workshop Resource Center. I look forward to hearing from you! - Visit John Alexander's Website |
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Cheryl MatthynssensCheryl is a life skills coach, licensed Chemical Dependency Counselor and a 20 year entrepreneur. Cheryl's dedication to achieving a life of balance led to her expanding her teaching from the simple managing of life's daily challenges to adding financial well being as well. A direct marketer with DrinkACT, she is gaining ground in the online community with her concepts of making sure business owners, entreprenuers and employees have well rounded life styles. She opened up a small affiliate site - The Balance Guide- to help others find resources for mental and emotional well being. Visit Cheryl's blog to see more of the diversity beyond business she has began offering online at www.thebalanceguide.blogspot.com - Visit Cheryl Matthynssens's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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