E-commerce and international business.

What does e-commerce have to do with international business?

Most of us have heard about Amazon.com, know how to purchase CDs, videos, and even cars on the Internet. This is what we usually refer to as e-commerce. However, this only accounts for 5-10% of actual e-commerce business. The remainder, almost 95%, consists of business to business transactions. 

E-commerce is expected to account for one third of the world's business transaction by the year 2002 according to Forester Research. During year 2003 e-commerce sales of $1.7 trillions are expected in USA and $3 trillions world-wide. The same source estimates the sales figures for year 2005-2006 to reach $13 trillion worldwide.

Virtually every enterprise is getting involved in some sort of e-commerce.
More than 750 B2B market places have already been established.

February 25 2000. 
GM, Ford and Daimler-Chrysler joined forced to create the world's largest virtual market. They are expected to buy parts for an estimated $240 billion (US) from tens of thousands of suppliers, all done electronically. Toyota, Renault and Nissan have indicated interest to join. It will not only have the procurement, purchasing and billing online with its suppliers; it will also connect its suppliers so they can do business between themselves. Increasing business and reducing costs.

February 28 2000. 
American Sears Roebuck and French Carrefour announced a retail consortium, GlobalNetExchange. Yearly purchases $80 billion.

March 1 2000. 
Cargill, DuPont and Cenex Harvest an American farm co-operative started Rooster.com that will deliver products to farmers and sell the produce from the farmers. All electronically.

July 2000. 
Nortel Networks IBM, is forming a B2B web market place. The group is expected to include Toshiba, Hitachi and Mitsushita Elctrical Industrial. Other founding members are expected to include LG Electronics, Seagate Technology, Solectron Corp and technology developers Ariba and i2/Aspect Development. The site will be called e2open.com

The cost savings are huge. A report by Giga Information Group estimate that worldwide cost savings on the net will reach nearly $1.25 trillion by year 2002.

Cisco the Software Company does B2B for over $8billion a year, $22 million a day. By using the Internet they save $600 million per year.

What are some of the reasons?

Cost for a call by a salesman: $200 per call.
Cost to take an order by phone: $25.
Costs for an order using e-commerce: $0.80
Interactive information over the net: 2 cents per call.

Many companies also do a large part of their customer service over the Internet, including "self-help" information.

To obtain the latest technical information about products just log into the web-site and search for the information you want to have.

So what does this have to do with you and international business?

You, as a small company, have the same opportunities as a large corporation to get exposure on the web. It makes it much easier for you to reach a worldwide customer base. Even if your clients do not buy online, you can attract new clients, supply them with information about your products as well as receiving information about them. Remove perceived boundaries and open the doors for new export sales.

You do not need to be a computer Guru to set up your own e-commerce site. There are free sites that provide help. There are also sites that, for a fee, will clear credit card transactions.

Check sites like:

http://www.freemerchant.com
http://www.bigstep.com
http://www.econgo.com
http://www.storesense.com
http://www.buyitonline.com
http://www.store.yahoo.com
http://www.amazon.com
http://www.jcat.com

The important thing is that your web-site is easy to find (Use those metatags!) and that you've informed the different search engines/web crawlers where to find you.

You need to make it easy to navigate through your web-site. For each "click" it's been estimated that you lose 20% of those visiting your site. (These are potential clients who're leaving before you've had a chance to interest them in what you're offering). If possible, make your site interactive. Avoid fancy features that'll require downloading of extra programs before being able to view your site. You'll lose even more potential clients this way.

Enter Internet and e-commerce. You can look at pictures on line and retrieve product information, find out about warranties and delivery terms, maybe even listen to a descriptive voice presenting information. With a simple click of the mouse you can make a purchase or a sale.

Start preparing your web site for:

1. Information for clients worldwide. Make sure to put in the right Metatags, i.e. keywords, allowing for keywords in the native language as well as your own. Make sure to register your web-site with as many search engines as possible. (www.submit.com will do it for a fee).

 
2. Make the site easy to search and find information. (See our search button on our web site: www.exportpro.com)

 
3. If you want to sell online, use an already establish company and program. (see above)

 
4. Make sure your web-site is easy to find has a search feature and has easily accessible information.

 
5. If possible, have your web site in different languages. www.altavista.com has a translation feature that can translate your whole web-site into another language. (Have the final version checked over, though). This feature can also be used to translate replies to/from languages you don't understand. Write your reply in e.g. English and translate it into Spanish.

Welcome to the world of global business.

Good luck!

Leif Holmvall
 

Questions and  answers.

We receive a large number of questions from our readers, some asking for very detailed information. Unfortunately, we cannot "afford" to answer them all. But we would like to extend an offer to you. 

If you have  questions that can be of interest to many of our readers and if we are allowed  to publish both question and answer, we will answer you and also include both question and answer as part of the newsletter in the up-coming  issues.

So we welcome your questions.