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Realizing the promise of e-commerce for SMEs
Friday, January 13, 2012
Several years ago, Nobel Prize winning economist Joseph Stiglitz suggested that land reform was the single most important thing governments could do to confront global poverty. He noted that democratizing the means of production was the path historically taken by every country that had climbed out of poverty, including those in Western Europe and East Asia. In the same way that land was the means of production of the past, knowledge will be the means of production of the future.
When e-commerce began in the mid-1990s, development experts swooned at its prospects of “leveling the playing field for the little guy.” Even Bill Gates gushed about the promise of “friction free capitalism” enabling small and medium enterprises (SMEs) to bypass the long chain of middlemen that take the lion's share of income.
But the truth was: even SMEs that managed to build a catalog discovered that buyers had difficulty finding it among the billions of websites on the Internet. And even if they did, they wouldn’t trust it. So besides the technical difficulties, SMEs also found it hard to establish visibility, credibility and trust.
Recently, the following dramatic technical advances have changed everything:
Major corporations now offer powerful "cloud computing" services.
A proliferation of low cost devices ranging from mobile phones to netbooks to tablets has greatly expanded the hardware choices for accessing the Internet.
Social networking services demonstrated how to leverage the power of trust.
My organization, OpenEntry.com, built an e-commerce platform offering
operating on Google’s cloud computing technology, serving more than 2,400 SME users in 44 countries. Catalogs can be built with a smartphone and instructions are in 57 languages. It also enables any business network to aggregate all the catalogs of their members—even those built with other systems—into a branded “
” to generate visibility, credibility and trust.
Because of companies and organizations like ours,
of modest means who traditionally would not be able to find jobs can exercise their skills and excel. For example, women who face cultural restrictions around their public activities can help local SMEs create their catalogs from product images sent to them electronically. And location isn’t a factor -- the United Nations Development Program
OpenEntry’s role in generating 3,918 jobs for youth and artisan women in Nepal. With the huge volume of demand created by the estimated 100 million SMEs that will take their businesses online in the next ten years, the scope is now open for self-taught entrepreneurs to emulate Bill Gates, Steve Jobs, Larry Ellison, Michael Dell and Mark Zuckerberg, none of whom finished college.
Past history demonstrates that international trade has boosted the development of nations that escaped poverty. Current history confirms that a country’s growth is directly related to its adoption of information and communication technologies. And future history will substantiate how democratizing the confluence of global trade and the Internet will help alleviate poverty and speed the general development of national and global economies.
posted by Daniel Salcedo, founder and CEO of
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