Small businesses are not only the growth engines of an economy, but they are highly critical to international trade, job creation, and global economic development. According to the World Bank, SMEs represent about 90 percent of businesses and more than 50 percent of employment worldwide. Formal SMEs contribute up to 40 percent of national income (GDP) in emerging economies globally.
The global e-commerce landscape is expanding. It has, therefore, become increasingly vital to rope in small enterprises so that these too can reap the benefits of the digital economy. According to the latest publication from Meticulous Research, the global e-commerce market is expected to grow at a CAGR of 11.1 percent from 2018 to 2025, reaching $24,265.12 billion by 2025.
The Power of B2B E-Commerce
B2B e-commerce is the sale of goods or services between businesses via an online sales portal. A study from Mckinsey & Company shows that about 18 percent of B2B revenue is coming directly from e-commerce, and about 65 percent of B2B companies across industries will be fully transacting online in 2022. And for the first time, B2Bs are more likely to offer e-commerce over in-person sales.
According to Digital Commerce 360, in 2021, online sales on B2B e-commerce sites, log-in portals, and marketplaces increased 17.8 percent to $1.63 trillion. These staggering figures can be attributed to millennials, who are driving the global e-commerce businesses. As per reports, 73 percent of B2B online buyers today are millennials. The rise in disposable incomes, the high mobile and internet penetration, technological advances such as big data and cloud-based e-commerce platforms, and advanced shipping and payment options are pushing the B2B e-commerce growth to unimaginable levels.
Since small businesses are the cornerstone of the global economy, governments and international institutions should join hands to train entrepreneurs’ in mapping out the digital transformation of such enterprises. When an increasing number of consumers are shifting to the virtual world and third-party online marketplaces, such as Amazon Business, are growing at a phenomenal rate, small businesses need the necessary guidance and support to leave behind legacy systems and invest in e-commerce platform technology to get easily discovered and sell across a broad spectrum.
Thinking along these lines, the International Trade Centre’s SME Trade Academy has been providing online courses to entrepreneurs to train them in B2B e-commerce. These courses guide entrepreneurs through the steps that a company should take before venturing into B2B selling via online channels. It educates SMEs on the importance of creating high-quality e-commerce content for their online initiatives, digital marketing, and website optimization, with the goal of providing them with the tools they need to make their B2B e-commerce operations as effective as possible.
In a nutshell, e-commerce is quickly becoming a significant channel for international trade and one that has the potential to open up new avenues for economic growth. Small businesses should not be left behind due to a lack of logistics, appropriate technologies, and the ability to overcome legal and regulatory barriers. More than ever, SMEs require institutionalized assistance.
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