Boosting SMEs through new distribution and information solutions
‘E-solutions for SME export growth’, the third parallel session of the World Export Development Forum (WEDF) 2014, explored the entrepreneurial opportunities for digital business in Africa both in direct e-exports and in using new technology to facilitate traditional exports. There is enormous potential for growth, as more than half of the world’s mobile broadband subscriptions are in developing countries. SMEs can use online marketplaces to access business opportunities in new regional and global markets.
Developing countries are currently experiencing a boom in internet uptake, particular through mobile platforms. This greater connectivity has opened up new possibilities for SMEs to set up and run virtual businesses, facilitate transactions and improve communication with their customers.
Speaking during the World Export Development Forum, panellist Gagan Khurana, Head of Value Chain Partnerships at Grow Africa, said there were two ways that an SME can leverage modern technology. The first is to develop products and solutions that run on technology platforms and provide solutions to customers. The second is to actually use existing technology to grow your business.
Mr. Khurana gave the example of the Chinese Internet company Alibaba that has been listed on the New York Stock Exchange as a virtual business that had succeeded beyond expectations. He also pointed out that Alibaba offered a service that many SMEs will find useful as they can access global suppliers for their products or inputs at very competitive prices without having to make physical journeys. In this regard, the internet and modern technologies have created a new breed of entrepreneurs.
While SMEs in Africa still trade in traditional goods and services, online access has brought a number of immediate conveniences. These include access to information from far and wide, faster communication, and safe and secure financial transactions.
Maurice Kagame, a technology entrepreneur and Chief Executive Officer of Pivot Access in Rwanda, said that in the course of running his business he had established that most people demanded solutions that are not costly but efficient. The internet, he said, can help resolve the challenge of distribution, which is face by many SMEs.
Yet, even as the internet replaces much of the brick-and-mortar model of traditional business, Kagame noted that SMEs still need well-trained and incentivised partners and distributors on the ground. In this way, he noted, SMEs will be leveraging on technology to deliver products and services and in the process create jobs.
Sectors such as agriculture are a strong magnet for technology entrepreneurs designing solutions for farmers. But Mr. Khurana explained that, although there are solutions in the market, gaps still exist in connecting farmers to the market and making a real impact on their situations. To bridge the information gaps and truly assist traditional sectors through e-solutions, the next generation of technology entrepreneurs needs to take their ideas to the next level and solve problems in a cost-efficient manner.
Read the full summary of the third parallel session: ‘E-solutions for SME export growth’.
WEDF is organized by ITC, the only United Nations organization with an exclusive focus on assisting SMEs. The event is hosted by the Rwanda Development Board.