Institute for Development Policy and Management The University of Manchester

eCommerce for Small Enterprise Development

A Handbook for

Entrepreneurs
in Developing Countries
2006

Richard Duncombe
IDPM, University of Manchester

Richard Heeks

Robert !intu
FIT (Uganda)

"arbara #akangu

Sunil Abraham
Mahiti

Written y!

Richard Duncombe and Richard Heeks $nstitute for Development %olic& and 'anagement ($D%') University of Manchester, Precinct "entre, Manchester, M#$ %&', U( Tel! )**+#,#+-./+-011 Fa2! )**+#,#+-.$+00-% 3mail! richard4duncom e5manchester4ac4u6 3mail! richard4hee6s5manchester4ac4u6 Robert !intu and "arbara #akangu *$+ (,ganda) (ampala, Uganda 3mail! ro ert5fituganda4com Sunil Abraham 'ahiti 7angalore, India 3mail! sunil5mahiti4org

Pu lished y!

$nstitute for Development %olic& and 'anagement ($D%') 3mail! idpm5manchester4ac4u6 We ! http!889994sed4manchester4ac4u68idpm 7uilding Digital ;pportunities (7D;) Programme Department for $nternational Development # Palace <treet, =ondon, <W#3 /'3, U( 3mail! en>uiry5dfid4gov4u6 We ! http!889994dfid4gov4u68 Common-ealth +elecommunications .rganisation (C+.) "lareville 'ouse, -,+-. ;2endon <treet, =ondon, <W#? *3=, U( 3mail! info5cto4int We ! http!889994cto4int

Developed from a pro:ect supported y!

This hand oo6 can e used together 9ith /eCommerce for Small Enterprise Development 0 A Handbook for Enterprise Support Agencies in Developing Countries/1 9hich has een designed specifically for use y agencies that are assisting micro and small+scale enterprises 9ith e"ommerce4 2ie-3do-nload both handbooks from4 http!889994ecomm*dev4org8 2ie-3do-nload additional handbooks concerning $C+s and enterprise development at4 http!889994sed4manchester4ac4u68idpm8research8is8ictsme8inde24htm

5ist of Contents 'o9 To Use This 'and oo644444444444444444444444444444444444444444444444444444444444444444444444444444444444444# A6 $ntroduction66666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666666662 @#4 What Is e"ommerceA444444444444444444444444444444444444444444444444444444444444444444444444444444444444444444@-4 'o9 "an e"ommerce 'elp Improve ?our 7usinessA4444444444444444444444444444444444444444$ @$4 e"ommerce Pitfalls444444444444444444444444444444444444444444444444444444444444444444444444444444444444444444444* @*4 What ?ou Beed To Do For e"ommerce4444444444444444444444444444444444444444444444444444444444444, "6 Small Enterprise .n +he Road +o eCommerce6666666666666666666666666666666666666666666666666667 7#4 Moving Up The e"ommerce =adder4444444444444444444444444444444444444444444444444444444444444444444. "ase <tudy #! <edu Welding and Fa rication C e"ommerce <tep #44444444444444444444444444% "ase <tudy -! Mu6ono WomenDs @ID< Tas6 Force C e"ommerce <tep -44444444444444#1 "ase <tudy $! @dam <ons C e"ommerce <tep $444444444444444444444444444444444444444444444444444444## "ase <tudy *! <tar "afE C e"ommerce <tep *444444444444444444444444444444444444444444444444444444444#"ase <tudy /! (amal 7ells C 3lements of e"ommerce <tep /44444444444444444444444444444444#$ "ase <tudy ,! Pro:ect Toe'old C Fetting to e"ommerce <tep ,44444444444444444444444444444#* C6 Are 8ou Read& *or 9eb:"ased eCommerce;666666666666666666666666666666666666666666666666666<6 "#4 'o9 To @nalyse ?our 3nterprise444444444444444444444444444444444444444444444444444444444444444444444#. "-4 Ten Tips For e"ommerce4444444444444444444444444444444444444444444444444444444444444444444444444444444444-1 "$4 What (ind ;f e"ommerceA444444444444444444444444444444444444444444444444444444444444444444444444444444-"*4 e"ommerce Facilitators4444444444444444444444444444444444444444444444444444444444444444444444444444444444444-$ D6 eCommerce "est %ractice =uides6666666666666666666666666666666666666666666666666666666666666666666666662> @dvice <heet #! Fetting "onnected @nd Ma6ing @ <tart4444444444444444444444444444444444444444-/ @dvice <heet -! Using 3lectronic Mail (3mail)4444444444444444444444444444444444444444444444444444444-, @dvice <heet $! e"ommerce <6ills44444444444444444444444444444444444444444444444444444444444444444444444444-. @dvice <heet *! We Development4444444444444444444444444444444444444444444444444444444444444444444444444-0 @dvice <heet /! ;nline Promotion 44444444444444444444444444444444444444444444444444444444444444444444444444-% @dvice <heet ,! Bet9or6ing @nd "ommunities ;n The Internet444444444444444444444444444$# @dvice <heet .! "ontracting ;ut We <ervices444444444444444444444444444444444444444444444444444444$@dvice <heet 0! ;rder Fulfilment @nd =ogistics44444444444444444444444444444444444444444444444444444$$ @dvice <heet %! "osts ;f We +7ased e"ommerce4444444444444444444444444444444444444444444444444$* @dvice <heet #1! <ome =egal8Gegulatory Issues44444444444444444444444444444444444444444444444444444$/ @dvice <heet ##! We <ecurity44444444444444444444444444444444444444444444444444444444444444444444444444444444$, @dvice <heet #-! ;pen <ource <oft9are44444444444444444444444444444444444444444444444444444444444444444$. E6 ,nderstanding 'ore About eCommerce666666666666666666666666666666666666666666666666666666666666?@ 3#4 Flossary8Hargon uster4444444444444444444444444444444444444444444444444444444444444444444444444444444444444444$0 3-4 Further Information C We +7ased <ources4444444444444444444444444444444444444444444444444444444*1

Ho- +o ,se +his Handbook This hand oo6 is designed for entrepreneurs running small enterprises in developing countriesI including micro+enterprises4 The hand oo6 9ill also e useful for entrepreneurs in medium+siJe enterprises4 The hand oo6 is designed for those 9ho are ne9 to e"ommerce and have little 6no9ledge of 9hat is involved as 9ell as for those in enterprises that are already using information and communication technologies (I"Ts) in their usinesses C including computers, email and mo ile phones4 The o :ectives of the hand oo6 are to! ;utline some asic information a out e"ommerce for enterprises including the enefits and the pitfalls (<ection @)4 Present some case studies sho9ing ho9 e"ommerce has een used in practice y small enterprises (<ection 7)4 'elp you ma6e decisions a out e"ommerce (<ection ")4 Provide information a out different aspects of e"ommerce (<ection D)4 Direct you to9ard further information on e"ommerce (<ection 3)4

First, read through Section A to learn more a out e"ommerce4 Then loo6 at Section " and decide 9here you are on the De"ommerce ladderD4 ?ou can then loo6 through case studies of enterprises using e"ommerce4 Section C 9ill help you to find out if your enterprise is ready for e"ommerce4 Section C1 as6s you to thin6 a out your usiness goals and carry out an analysis of your o9n enterprise4 The analysis focuses on your potential for D9e + ased e"ommerceD and e2amines your mar6ets, your customers, your products and services, your location, your s6ills, technology and finances4 ?ou 9ill then need to decide 9hat level and type of e"ommerce 9ill suit you4 Section C2 9ill help you do this y suggesting some of the costs and enefits for each Dstep to e"ommerceD and the overall li6ely impact of e"ommerce on your usiness4 @ final decision you 9ill have to ma6e concerns 9hether you should develop e"ommerce yourself or 9hether you should 9or6 through an De"ommerce facilitatorD4 Section C3 outlines some strengths and 9ea6nesses of a range of e"ommerce facilitators you may 9ish to trade 9ith or consider for support4 Finally, loo6 at Section D1 9hich provides information on various aspects of D est practiceD in e"ommerce, and Section E 9hich provides sources of further information a out e"ommerce4

A6 $ntroduction
There are tens of millions of small enterprises, including micro+enterprises, in developing countries (D"s)4 More than %1K of all firms in D"s are micro+ and small enterprises (M<3s), and these typically contri ute 01+%1K of all employment4 They are also significant in 9ealth creation, ma6ing up perhaps around a >uarter of gross domestic product and often contri uting to e2ports as 9ell4 In an increasingly competitive and glo alised 9orld, M<3s need to compete more effectively in order to further oost domestic economic activity and contri ute to9ard increasing e2port earnings4 M<3s 9ill also continue to play an important role in increasing employment and incomes and thus contri ute to poverty reduction on a sustaina le asis4 eCommerce is emerging as a ne9 9ay of helping usiness enterprises to compete in the mar6et and thus contri uting to economic success4 e"ommerce can help deliver economic gro9th, increased usiness opportunities, enhanced competitiveness and etter access to mar6ets4 @t present, though most small enterprises lac6 the 6no9ledge of ho9 investment in e"ommerce could enefit their usinesses and help them develop that competitive edge4 This is at a time 9hen the opportunities for small enterprises to adopt e"ommerce are gro9ing due to improved access to the technical and communication infrastructure4 This hand oo6 9ill help you to understand more a out e"ommerce and 9hat e"ommerce has to offer your usiness4 It 9ill help you to decide if you need e"ommerce in your usiness, and the type of e"ommerce that can enefit your usiness4 A<6 9hat $s eCommerce; eCommerce involves the sale or purchase of goods and services over computer net9or6s y usinesses, individuals, governments or other organisations4 e"ommerce uilds on traditional commerce y adding the fle2i ility and speed offered y electronic communications4 This can facilitate improvement in operations leading to su stantial cost savings as 9ell as increased competitiveness and efficiency through the redesign of traditional usiness methods4 eCommerce is the application of current and emerging information and communication technologies (I"Ts) to conduct usiness4 These include e2isting technologies li6e landline telephone and fa2, ut the I"Ts offering most scope for small usinesses are mo ile phones, electronic mail and other Internet+ ased services4 'o9ever, eCommerce is not :ust a out using ne9 technologies4 e"ommerce can also help support profita le usiness relationships and assist you to more effectively manage and run your usiness enterprise4 This 9ill involve creating more effective e2ternal interactions 9ith customers, clients, colla orators and suppliers, ut it can also mean improving internal usiness efficiency and even the emergence of ne9 products and services4

e"ommerce may involve selling directly from usinesses+to+consumers ("2C eCommerce)4 For e2ample, a num er of craft producers and tourism enterprises have already found some success dealing directly 9ith customers4 e"ommerce can also e conducted directly et9een usinesses ("2" eCommerce)4 This is y far the most common type of e"ommerce at present4 7-7 activity includes portals that operate as electronic mar6etplaces or as auction sites4 7enefits of eMar6etplaces can include reduced costs, etter research and >uic6er transactions for uyers4 Ge9ards for sellers include improved customer service levels and cheaper e2posure to customers4 There is also usiness+to+government activity ("2= eCommerce) that refers to the gro9th in supply of goods and services for online government procurement C potentially a large gro9th area in developing countries4 A26 Ho- Can eCommerce Help $mprove 8our "usiness; e"ommerce can provide su stantial enefits for your usiness via improved efficiencies and raised revenues4 It can ena le ne9 9ays of 9or6ing to emerge as your usiness faces the future and em races the ne9 economy4 e"ommerce ena les you to gain access to etter >uality information, and thus empo9ers you to ta6e informed decisions a out your usiness4 Most importantly, e"ommerce can give your enterprise a competitive advantage4 It can help strengthen your mar6et position and open up ne9 usiness opportunities 9ith the potential to improve profits4 7enefits of e"ommerce can arise in the follo9ing 9ays! Cost Reduction "enefits Reduced travel costs: y using a mo ile phone, email and other I"Ts to su stitute for :ourneys4 Reduced cost of materials: more information means etter choice of suppliers and more competitive prices4 Reduced marketing and distribution costs: for e2ample, pu lishing a rochure online can reach an unlimited num er of potential e2port customers and allo9 regular update4 Reduced sales costs: the Internet provides unprecedented opportunities for usinesses to reduce the costs of trade locally and, even more, across orders4 More efficient supply chain management: can eliminate the need for middlemen leading to lo9er transaction costs (including mar6eting, sales, transaction processing), reduced overhead, and reduced inventory and la our costs4 Improved internal functions: cutting do9n on meetings, improving the e2change of critical 6no9ledge, eliminating red tape, and streamlining communications4

'arket "enefits Greater reach: a 9e presence can allo9 you to reach out to customers far eyond your immediate location4 More brand awareness: offering ne9 avenues of promotion for products and services4 Improved customer service: providing more responsive order ta6ing and after+ sales service to customersI this, in turn, can lead to increased customer loyalty4 Increased market awareness: you can ecome more a9are of competition 9ithin your mar6et and more a9are of mar6et changes, 9hich can lead to product/service innovation or quality improvement4 .ther Competitiveness "enefits Increased efficiency: e"ommerce not only reduces costs ut it can also increase the speed of transactionsI oth uying and selling4 Continuous trading: suppliers and customers, if they 9ish, can access a -*+ hour8.+day sales service C particularly important 9hen trading through time Jones4 pecialisation: e"ommerce can help you to focus your activities C ma6ing it easier to uild relationships 9ith other enterprises and communicate your needs to support agencies4 Many of these enefits can e gained through relatively modest investments in ne9 technology and systems4 Freater enefits may accrue as the enterprise moves up the e"ommerce adoption ladder (see <ection 7#)4 It is important to realise, ho9ever, that the enefits outlined are not e2clusively tied to e"ommerce4 For e2ample, mar6et enefits may e achieved more effectively through etter usiness net9or6ing and the uilding of personal usiness relationships, rather than through use of the Internet4 This emphasises the importance of adopting an approach to9ards e"ommerce that puts usiness o :ectives first, rather than elieving that technology alone can deliver the enefits descri ed a ove4 A?6 eCommerce %itfalls There are great potential enefits ut there are also pitfalls of going into e"ommerce4 They are the financial costs, the usiness Dopportunity costsD and the dangers of failure4 These are detailed elo9! e"ommerce 9ill ring e2tra costs as 9ell as potential cost savings4 The start+ up costs (initial investment in a computer8net9or6 connection, etc) 9ill e high and there 9ill e additional running costs (see @dvice <heet %)4 e"ommerce activity 9ill need to run in parallel 9ith e2isting usiness methods4 For e2ample, you 9ill need to continue to produce paper+ ased mar6eting material ( rochures, stationery, leaflets, etc) as 9ell as uilding up your 9e presence4 This 9ill duplicate some activities adding to overall costs4 e"ommerce may divert attention a9ay from more important offline activities4 It is important that online and offline efforts are not in competition 9ith each *

other 9ithin a usiness4 In fact, for most M<3s, offline activities (such as face+to+face meetings and personal net9or6ing) 9ill remain far more important than online communication4 @n e"ommerce venture may 9ell fail completely li6e any ne9 usiness venture4 This highlights the importance for small usinesses of not thro9ing all their eggs into the e"ommerce as6et4

Ho-ever1 there are also risks of ignoring eCommerceA Technology and innovation can ring positive changes to your usiness C 9hich can improve the 9ay you do usiness in the future4 The ris6s of not effectively em racing technology may e felt throughout your usiness in years to come4 For e2ample! 'aving no 9e site, or a adly designed or mar6eted 9e site, may put your usiness at a disadvantage as compared 9ith your competitors, particularly if you are an e2porter or a tourism usiness4 Unsuita le or inade>uate technology can mean that your enterprise is 9ithout the communications systems that it needs to compete efficiently4 Increasingly, enterprises that lac6 a customer and sales data ase may find it difficult to carry out the regular and effective direct mar6eting and communication that competitors conduct, and 9hich customers e2pect4

AB6 9hat 8ou #eed +o Do *or eCommerce The asic re>uirements to get started are as follo9s! A computer4 A landline telephone4 A modem4 This device converts digital information from computers into electronic signals that can e transmitted over telephone lines4 Internet browser software4 This usually comes installed already ut ma6e sure 9hen purchasing your computer you as6 if it has this soft9are4 The services of an Internet Service Provider (ISP 4 These provide you 9ith access to the Internet4 An email address in order that local, regional, and especially, international customers can communicate 9ith you4

<ee the @dvice <heets later in this hand oo6 for more details of all these re>uirements4 Gemem er that you do not have to o9n all of these yourself C you could access them via a telecentre or Internet cafE, or you could share o9nership 9ith other entrepreneurs4 ?ou can also ma6e a start on e"ommerce :ust using a mo ile phone4 "ut don/t forget C personal face+to+face contact is still the most important method of usiness communication C particularly 9ith your customers4 There are still many effective 9ays to uild your usiness communications that donDt involve modern technology, such as! "uilding a good reputation for your usiness4 This 9ill help to spread information a out your usiness through 9ord+of+mouth4 A professional image 9ill help to promote your usiness4 The use of a printed usiness card, a letterhead and a logo, or sign oard outside your usiness premises 9ill help in this respect4 Advertising your usiness4 The use of printed leaflets, posters, cards in shops or adverts in local8national papers 9ill reach a 9ide customer ase4

The use of e"ommerce technologies 9ill help you uild on these good usiness practices! for e2ample, using the Internet (or a mo ile phone) to promote your usinessI to ta6e or give ordersI or to communicate 9ith your customers at a cheap rate via email4

"6 Small Enterprise .n +he Road +o eCommerce

This section outlines the Dsteps to e"ommerceD descri ing the differing stages of e"ommerce development that you may find in a small enterprise4 It does this through a model and then presentation of si2 real+life case studies of small enterprises using e"ommerce4 The case studies sho9 ho9 enterprises are enefiting from e"ommerce, as 9ell as some of the pitfalls4 Which step of the e"ommerce ladder are you onA Gead through the case studies4 ?ou may identify an enterprise that is at a similar stage to your o9n4 "<6 'oving ,p +he eCommerce 5adder The DstepsD model can help you understand the different types of e"ommerce usiness applications you may encounter4 It may also help you to identify the type of assistance you may re>uire4

Step <6 Starting .ut4 Simple messaging using mobile communications "urrently D9irelessD communications C including short messaging services (<M<) C provide a cheap and 9idely availa le option for enterprises4 Mo ile phones offer a num er of 6ey advantages over fi2ed line communications for small usinesses C such as instant communications 9ith customers and suppliers, even 9hen on the move4 They also provide greater connectivity and net9or6 coverage than landlines C users can e instantly connected y te2t messages and mo ile chat C a po9erful mar6eting and advertising tool4

Step 26 =etting .nline4 Email messaging ?ou can send or receive emails from a computer terminal either located on your usiness premises or via a facilitator (such as an Internet cafE or telecentre)4 3mail is a cheap, >uic6 and relia le 9ay to e2change usiness information 9ith customers, suppliers, and usiness contacts 9ho are also connected to email4 @ variety of information can e sent C not :ust messages, ut documents, photographs, dra9ings, or any other computer data file (see @dvice <heet - for more information on email)4 Step ?6 9eb %ublishing We pu lishing can e used to ma6e enterprise information availa le C y using an online rochure, for e2ample4 Its simplest form may consist of a $+* page 9e site giving a asic usiness profile, some information a out products and services, and contact information C physical and postal address, telephone and fa2, and email contact4 In a more advanced form it may include an online catalogue C an online version of a conventional catalogue that can e easily updated4 3ven a simple 9e presence offers the a ility to access a 9ide C potentially glo al C mar6et 9ith -*8. accessi ility4 (<ee @dvice <heet * for more information on creating 9e sites4) Step B6 9eb $nteracting We interaction 9ill allo9 customers (for e2ample) more scope to ro9se through images, descriptions and specifications relating to your products and services4 It may allo9 them to su mit email en>uiry forms, to order online, to use online services or to use a shopping cart facility and order confirmation C that could e paid for and fulfilled (delivered) offline4 Interaction over the 9e can improve customer service and response to customer >ueries4 Step >6 9eb +ransacting This can e termed as having a full e"ommerce capa ility that covers the 9hole transaction process from the placing of an order to online payment for goods and services via secure net9or6s4 For 7-" e"ommerce this 9ill involve ma6ing use of secure credit card payment systems, and for 7-7 e"ommerce 9ill involve payment through secure an6ing systems4 Step 66 9eb $ntegration e"ommerce may also ta6e on a 9ider role 9ithin a usiness through 9e integration4 We integration provides an electronic platform that lin6s customer+facing processes such as sales and mar6eting (the Lfront officeL) 9ith internal processes such as accounts, inventory control and purchasing (the L ac6 officeL)4 This is often called e7usiness or the usiness may e descri ed as ecoming fully Le+ena ledL4 e7usiness lin6s internal systems 9ith e2ternal net9or6s (customers, suppliers and colla orators) via the Internet4 Integrating systems can ma6e it easier and cheaper to do usiness, and it can encourage customer loyalty and repeat usiness4

Case Stud& <4 Sedu 9elding and *abrication 0 eCommerce Step < .vervie-4 @ micro+enterprise run y a single entrepreneur producing fa ricated metal products C 9indo9s, doorframes and eds C 9ith t9o employees, and a turnover of a out U<M$11+,11 per year4 The enterprise sells to local mar6ets and serves many sectors including the construction sector, supplying 9indo9s and doorframes, and rural schools and hospitals supplying eds4 The enterprise mainly sells to individual consumers and schools4 $C+ Resources4 The enterprise has a mo ile phone 9hich cost the o9ner U<M01 and re>uires a monthly fee of at least U<M* of airtime to operate on the net9or64 This enterprise has no financial support and depends solely on income generated and savings4 eCommerce "enefits4 The use of a mo ile phone has greatly improved usiness y ena ling constant access to customers, even 9hen the entrepreneur is a9ay from his usiness site4 7oth customers and suppliers can e contacted giving an immediate response and direct communication that has tremendously cut do9n transport costs and given access to a 9ider mar6et4 The phone has helped him forge a personal relationship 9ith clients for repeat orders4 <uppliers can also e readily contacted4 The enterprise has uilt use of the phone into its mar6eting strategy y distri uting the phone num er 9henever possi le via usiness cards and displaying it on finished products4 eCommerce Challenges4 The phone itself does not ring challenges4 @s to further e"ommerce steps, the usiness o9ner regards other I"Ts (such as computers) as too e2pensive to use4 7esides he does not 6no9 ho9 to use them4 'e prefers to spend his resources on a cell phone as he could not ris6 eing 9ithout one in his usiness4 eCommerce Support4 The enterprise has not received any support e2cept in the sense that the mo ile net9or6 provider delivers the infrastructure re>uired for the phone4 5essons 5earned4 The phone should e availa le for use at all times of the day4 'ence, it is advisa le to :oin net9or6s that do not charge a service fee4 It is important, therefore, to compare the pac6ages that phone companies are offering in order to minimise costs and select a service that 9ill meet your needs4 Unfortunately he lost most of the num ers of his customers and contacts 9hen his mo ile phone 9as stolen C this reinforces the importance of 6eeping ac6+up records also4

Case Stud& 24 'ukono 9omen/s A$DS +ask *orce 0 eCommerce Step 2 .vervie-4 MW@TF is a self+help enterprise producing tree seedlings, vegeta les and metallic stoves, employing si2ty 9omen, 9ith a turnover of U<M$,,114 It serves the home mar6et only4 The vegeta les are perisha le so they only harvest 9hen they can e sure of the mar6et4 $C+ Resources4 The enterprise has no direct access to I"Ts ut uses a community telecentre that is located -6m a9ay from their premises4 They regularly use the telecentre landline phone that charges them U<M14-/ per minute4 They also use the email service to correspond and communicate 9ith agencies in at home and a road4 They usually use the email services t9ice a 9ee6 (costing U<M141-/ per minute)4 <ince the connections are slo9 it can ta6e up to t9enty minutes to complete their communication4 eCommerce "enefits4 The telephone service is used to ascertain the mar6et for their produce efore they harvest or ta6e their produce to mar6et4 The phone has saved oth time and money, giving rise to etter prices4 Nia email, they have een a le to esta lish contacts 9ith a num er of ne9 organisations and individuals 9ho have su se>uently offered assistance4 eCommerce Challenges4 The computer currently provided at the telecentre are too fe9 C :ust t9o for the 9hole local community C and also too slo94 <lo9 transmission speeds also mean high costs for access4 eCommerce Support4 MW@TF has received support from the telecentre 9hich has offered computer training to the staff and some mem ers at a su sided rate4 They have also assisted 9ith training of the staff, and demonstrated ho9 the Internet can e used to search for information4 The telecentre also passes on messages to MW@TF4 'ence the telecentre is an important point of contact for the organiJation4 5essons 5earned4 When using the telecentre users are encouraged to have letters typed eforehand and then :ust copied to send4 This costs less compared 9ith composing a letter online4 It is also important to use the telephone effectively to find out a out the mar6et or the prices efore setting off to mar6et C this is especially valua le if the mar6et is far from the locality4 The enterprise intends to install a phone at their premises that can e used y its mem ers at a cheaper rate4

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Case Stud& ?4 Adam Sons 0 eCommerce Step ? .vervie-4 The usiness ma6es machinery used in plantations such as machinery for processing coffee4 They have nine employees, and recent annual turnover 9as U<M#-,,1114 Their main mar6et is the home district ut /K of turnover comes from e2ports C they have een e2porting machinery for five years4 $C+ Resources4 They have five landline phones and three mo ile phones4 In addition, there is a single personal computer (P") operating in the usiness for email, We and other purposes4 The P" has a UP< ac6+up system4 @dam <ons also has created its o9n 9e site4 eCommerce "enefits4 They have attracted prospective clientele and enthusiastic persons 9ho have ro9sed through their 9e site to get information regarding their coffee machinery units4 They have received a num er of visitors y ensuring that the site is listed on some main We search engines4 They have also found enefits as users of the We I for e2ample in finding information they needed a out gasoline+po9ered generators4 3mail has een useful in saving costs 9hen contacting e2ternal clients or suppliersI some orders are also received via email4 eCommerce Challenges4 "limatic conditions in their location can cause pro lems, including some unrelia ility of telecommunications4 The high charges for airtime 9hen using mo ile phones4 Pro lems upgrading 9e site to o tain details of interested8prospective customers4 eCommerce Support4 They have received no direct support, ut the entrepreneur 9as motivated to ma6e a 9e site y a friend ased in the U< 9ho said that this 9ould help enhance the scope of the usiness4 5essons 5earned4 The entrepreneur states !"dvertising in newspapers turns out to be e#pensive but if we have a website$ we can %ust put the &R' of the website in the newspaper ( which saves a lot of space/money) Interested parties can log on to the net and find information about our business) *hus it should be on the agenda of every entrepreneur to have a website!) 'e also stated that customers are more enthusiastic a out reputa le companies and having a 9e site gives 9eight to a companyDs reputation4 They plan to upgrade the 9e site in order to add more transactional functionality to it, li6e a chat facility to allo9 one+to+one interaction 9ith clients4 They recommend see6ing out a good net9or6 connection that offers attractive and less e2pensive pac6ages4 The entrepreneur 9ould li6e to see government agencies supporting a 9e site specifically for8a out small enterprises, including a product catalogue displaying images 9ith easy 9ays to order the products4

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Case Stud& B4 Star CafC 0 eCommerce Step B .vervie-4 This enterprise roasts, lends and pac6ages coffee products and has #/ employees4 The customer ase is large since coffee is 9idely sold locally, including in rural areas4 The enterprise supplies usinesses, traders, supermar6ets, restaurants, shops, and offices, 9ith the local mar6et ma6ing up %%K of turnover4 The enterprise is planning to target the e2port mar6et, and sees its e"ommerce ase as an important foundation for this4 $C+ Resources4 The enterprise has access to t9o computers 9ith Internet access that 9ere ac>uired in -11#8-11-4 It also has a fa2 and phones ( oth landline and mo ile)4 The company has set up its o9n 9e site that provides details of the products it offers4 eCommerce "enefits4 .1K of the supermar6ets and hotels that the enterprise supplies have email (though most other local customers tend to use the telephone to place orders)4 3mail is a 6ey tool to create or strengthen personalised relationships 9ith ma:or clients through faster communication lin6s4 <tar "afE has ecome etter 6no9n and many ne9 usiness contacts have een made through its 9e site and email4 The 9e site has already demonstrated that it is a cost effective 9ay to reach out to the e2port mar6et4 They estimate the costs for a net9or6 connection and designing and hosting the 9e site to e a out U<M-/11 per year4 The enterprise also uses email for most usiness correspondence C this has proved to e a more efficient and cost+effective 9ay of communication than non+I"T+ ased means4 eCommerce Challenges4 <ervice rea6do9ns and slo9 dial+up Internet connections4 'igh investment costs for the I"Ts4 =ac6 of sufficient 6no9+ho9 related to use of I"Ts and their future development4 =ogistical re>uirements for the delivery of physical goods in order to fulfil electronic orders4 eCommerce Support4 The enterprise has not received any support in the area of e"ommerce4 The company had its o9n in+house strategies to finance these ideas4 The general manager indicated that once the enefits seem to :ustify the costs then an idea is considered4 5essons 5earned4 3nterprises should apply cost8 enefit analysis and determine if they really need the technology4 Ge>uirements need to e specified carefully and enterprises should shop around for different 9ays of solving pro lems in a cost effective manner4

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Case Stud& >4 !amal "ells 0 Elements of eCommerce Step > .vervie-4 The usiness has *1 employees and 9as esta lished in #%0$4 They manufacture machine and pressed metal components4 Their customers are #11K home mar6et ut some e2port products containing their components are used in the motor industry4 Their main customers are large motor engineering companies, and recent annual turnover 9as almost U<M*11,1114 $C+ Resources4 The company has four phones (t9o landline and t9o mo ile) and three personal computers, one 9ith an Internet connection4 They ma6e use of standard accounting soft9are and a customised system for illing and invoicing4 They use email ut have no company 9e site4 'o9ever, they are a le to transact online y ma6e use of 9e sites o9ned y suppliers or customers4 eCommerce "enefits4 @ccess to a mo ile phone is very useful to the "3; 9ho is al9ays on the move4 3mail has made communication much faster and easier They have registered 9ith an e2port portal 9e site through 9hich they have received a lot of information from various similar units and clients from all over the 9orld4 They have saved time and money y completing transactions online4 For e2ample, from one ma:or customer they received order details via email4 They then used the customer 9e site to fill in all necessary details a out the order, ena ling it to e processed electronically4 @ll further correspondence 9as conducted via email so that the entire transaction 9as completed online4 eCommerce Challenges4 <lo9 access speeds due to limited I"T infrastructure =ac6 of training in I"Ts4 Beed to integrate asic usiness processes such as inventory and product lists 9ith 9e + ased tools4 eCommerce Support4 The usiness has received support in the use of email and other aspects of e"ommerce from one of their main clients, 9ho are already e2perienced in using e"ommerce4 5essons 5earned4 There is a need for a continuous upgrading of technology4 'o9ever, along 9ith technology it is important the human element is retained in the unitI li6e the usiness o9ner says !each employee in my unit is treated like a family member$ and we discuss various problems together!4 'ence, too, the human element must also remain in dealings 9ith suppliers and customers4 =ocation is also important! they have enefited from eing located alongside heavy I"T+using enterprises4

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Case Stud& 64 %roDect +oeHold 0 =etting to eCommerce Step 6 .vervie-4 Toe'old manufactures and mar6ets traditional leather slippers and sandals4 These are manufactured y artisans of a local marginalised community 3sta lished in #%%%, it is run on a cooperative asis 9ith eight full+time employees4 Toe'oldDs customers are mainly shoe shops and outi>ues in @ustralia, Hapan, Italy and other countries4 $C+ Resources4 The company has three computers at its head office and one in the manufacturing centre4 Toe'old communicates 9ith its customers and its o9n manufacturing unit via email4 Its 9e site contains a catalogue of its products and customers are a le to ro9se and purchase its products via the integrated shopping cart application4 eCommerce "enefits4 Wor6ers in the villages are a le to spea6 to their head offices via mo ile telephony4 Decisions get ta6en faster and more cheaply, removing the need for travel4 Decisions also get communicated do9n the line more >uic6ly and cheaply4 Ge>uests are received via email and company representatives follo9 up 9ith a >uotation4 "lients also use email to send in suggestions, alterations and photographic evidence of damage8faults in products that might need replacement4 This helps Toe'old improve the >uality of their product design4 ;rders are received via the 9e site that 9ould other9ise e very unli6ely to come! Toe'oldDs e2port am itions 9ould have een very difficult to fulfil 9ithout e"ommerce4 @ management information system 6eeps trac6 of customers and predicts their uying patterns4 This helps the enterprise to optimise their leather and accessories purchases and 6eep inventory levels lo94 eCommerce Challenges4 Po9er supply remains erratic in the villages, 9hich can sometimes undermine use of email4 Internet connectivity is also limited in rural areas and finding trained staff is difficult4 Toe'old is also concerned a out retaining the intellectual property rights of its original designs C sho9casing these designs on the 9e means they could e copied y others4 eCommerce Support4 @ local I<P offered a free template+ ased shopping cart application4 Donor agencies have also provided Toe'old 9ith computers and soft9are at su sidised costs4 5essons 5earned4 @ digital camera is useful as images of ne9 products or test designs can e edited and uploaded >uic6ly onto a 9e site, and images are an important element of 9e + ased sales4 Toe'old has trained staff mem ers in the use of computers and they can no9 manage most communication via email4 The artisans come from a poorer section of society and their literacy levels are lo94 This has so far prevented them from eing part of the e"ommerce process4 Toe'old is trying to ring their levels to a asic standard so they may ta6e a more su stantial role in using I"Ts, ut this re>uires a concerted effort4 The firm sees creation of a more

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sophisticated 9e site as valua le for future salesI for e2ample ena ling uyers to create their o9n foot9ear designs or colour com inations4

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C6 Are 8ou Read& *or 9eb:"ased eCommerce;

7efore ma6ing a decision a out 9hat type of e"ommerce to adopt C and 9hether you are ready for 9e + ased e"ommerce C you should ensure that! ?ou have clearly defined your usiness goals and strategies4 ?ou intend to use e"ommerce in creative 9ays to improve e2isting usiness tools and capa ilities4 ?ou are a le to successfully alance you e2isting offline commerce activities and ne9 online e"ommerce activities4 ?ou have a realistic and achieva le plan for realising genuine enefits4

Planning for e"ommerce involves setting achieva le usiness goals, developing usiness strategies to achieve those goals, and ma6ing use of practical usiness tools4 Ta le # can help you to identify your usiness goals and help you to consider potential strategies and practical tools to achieve those goals4 +able <6 "usiness =oals and Strategies %ossible "usiness =oals Increase revenue from e!istin" customers "usiness Strategies 8ou Could Adopt 7uild repeat orders4 Develop customer loyalty4 "usiness +ools 8ou Could ,se Increased advertising and promotion4 7etter communication4 7etter customer service4 7etter mar6et information4 @ttendance at trade sho9s4 7etter cross+ order usiness net9or6ing4 Mar6et research4 Use of consultants and8or technical assistance4 7randing4 Improved design and pac6aging4 <tandards compliance4 3mployee involvement4 7etter purchasing4 Wor6force8resource planning4 Training and s6ills development4

#ocate new customers in e!istin" or new mar$ets

32pand domestic mar6ets4 32plore e2port mar6ets4

%iversif& products and services Increase competitiveness throu"h product'service innovation

Development of ne9 products or services4 Underta6e product or process improvements4 Technology upgrading4 Be9 production or service technology4 Internal8e2ternal usiness efficiency improvements4

Increase competitiveness throu"h cost reduction

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e"ommerce technologies can help ring improvement to all of the usiness tool e2amples listed in Ta le # C particularly those that involve etter communications C using email or mo ile phones, for e2ample4 It 9ill also e important that you are a le to prioritise your actions in order that you can use e"ommerce to produce enefits in the areas that are most important to your usiness4 For e2ample, if your main strategy is to uild repeat orders then efficient and effective communications 9ith your e2isting local customers 9ill e paramount4 'ere, effective use of mo ile communications rather than 9e + ased e"ommerce should pro a ly e prioritised, so that you can al9ays e in touch 9ith all your customers and they can also leave messages for you4 C<6 Ho- +o Anal&se 8our Enterprise The use of 9e + ased e"ommerce is li6ely to affect all aspects of your usiness4 Therefore, it is very important for you to analyse all aspects of your usiness efore you ma6e any decisions regarding e"ommerce4 Fo through the follo9ing sets of >uestions and note do9n some responses that apply to your usiness4 Then read the comments alongside the >uestions to gain some feed ac64 *irst1 &ou should consider &our 'arket @re your main competitors mar6eting or selling similar products or services over the InternetA Do your main customers or suppliers have access to the Internet or are they see6ing to use e"ommerceA *eedback4 If you ans9ered predominantly D?esD then you need to consider 9hether you are ahead, on a par, or ehind in comparison 9ith your competitors, customers and suppliers, in using the Internet and e"ommerce4 If you ans9ered predominantly DBoD then 9e + ased e"ommerce may not e a priority for you4

E and then &our %roFimit& to the 'arket Where are your main customers and suppliers locatedA Where are your usiness premises locatedA *eedback4 If your customers or suppliers are located overseas, and you are located in a 9ell+connected ur an area, then you have high potential for 9e + ased e"ommerce4 If your customers or suppliers are located in+country and you are located in a rural area, then you may 9ant to consider using a mo ile phone or gaining access to a telecentre to use email4

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E -hat about the %roducts and Services &ou offer Do your products or services have road or specialised (niche) mar6et appealA @re your products or services suita le for mar6eting or selling over the InternetA "an your products or services e delivered electronicallyA *eedback4 More specialised products or services are more suited to Internet mar6eting or selling4 "onversely, if your products or services are serving saturated mar6ets 9here there are large num ers of competitors then your potential for 9e + ased e"ommerce may e lo9er4 If you are unsure a out the suita ility of your products then you need to do some additional mar6et research4

E pa& special attention to &our EFisting Customers @re your customers Dother usinessesD or Dfinal consumersDA @re your usiness customers small or large enterprises or organisationsA @re your customers operating in sectors that have high or lo9 potential for e"ommerceA If you sell to final consumers, do they tend to have high disposa le incomes or lo9A *eedback4 If your customers are large or medium+scale usinesses operating in high potential sectors or if they are consumers 9ith high disposa le incomes then you have high potential for e"ommerce4 If your customers are lo9+ income consumers or small and medium+scale enterprises operating in lo9 potential sectors then you may have lo9er potential for e"ommerce4 If you are unsure then you need to do some additional mar6et research concerning your customers4

E neFt consider &our "usiness Is your enterprise ne9 or 9ell esta lishedA *eedback4 The siJe and the gro9th+rate of your enterprise are not as important as your mar6et, your products and the nature of your customers for 'o9 many employees does your determining your potential4 'o9ever, if you have a larger 9ell+esta lished usinesses then you are enterprise haveA more li6ely to have greater availa le resources for investment in 9e + ased e"ommerce4 ;n the Is your enterprise gro9ing, other hand, if you have a greater num er of contracting or reasona ly employees then clim ing the steps to e"ommerce sta leA may present greater challenges in terms of transforming s6ills and attitudes across your What 9as the turnover of your 9or6force4 <maller enterprises employing t9o+ enterprise in the last financial five persons may find it easier to adapt, although it yearA is li6ely that availa le resources 9ill e lo9er4

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E &our Access to $C+s Do you currently have access to email or the Internet on your usiness premises or via a third partyA Does your enterprise currently have a 9e siteA @re your internal IT systems net9or6edA To 9hat e2tent are your usiness processes (customer data ase, accounts, invoicing, purchasing, etc) computerisedA *eedback4 If you are already a computer8email or Internet user and those facilities are accessi le on your usiness premises, you have greater potential to clim the steps to e"ommerce4 If you have yet to deploy I"Ts 9ithin your enterprise then you need to consider carefully the issues covered in this hand oo6 and decide 9hat type of I"Ts 9ould e most eneficial4

E &our $C+ and "usiness Skills @re you an I"T enthusiast and do you have I"T s6illsA @re your employees familiar 9ith I"Ts and 9hat is their level of I"T s6illsA Do you have I"T support availa le Din+houseD or do you depend upon e2ternal maintenance and development of your I"TsA *eedback4 3nthusiasm (commitment and leadership) is pro a ly the most important s6ill you can ring to any e"ommerce initiative4 It 9ill also e necessary to develop the technical and usiness s6ills to successfully implement the technology and the innovations that 9ill lead to ne9 9ays of doing usiness4 If you already have I"T s6ills and e2perience this 9ill greatly increase your potential for e"ommerce4 'o9ever, good usiness s6ills C the a ility to recognise ho9 ne9 technology can e used oth 9isely and cost effectively C are li6ely to e more important than your technical s6ills

E &our "usiness Environment @re local telecommunication services provided to suit e"ommerceA 'o9 advanced is your nation regarding the legal, regulatory and an6ing re>uirements for e"ommerce e4g4, secure paymentsA To 9hat e2tent can transport and delivery systems meet the needs of potential e"ommerce customersA *eedback4 The a ility of your enterprise to clim the steps to e"ommerce 9ill depend not only upon your o9n s6ills, ut also upon the level of support, and the constraints, that e2ist locally4 @n increased level of a9areness of these De+readinessD issues 9ill help you understand the constraints under 9hich your enterprise is li6ely to e operating4

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E and finall& &our *inances 'o9 financially sta le is your usinessA What investment resources do you have availa leA @re you a9are of the total li6ely financial cost (investment ) recurrent costs) of e"ommerceA 'ave you 9eighed the costs against the enefitsA *eedback4 It is necessary that you have access to financial resources to ma6e your initial investment, ut you also need to e a le to generate sufficient revenue to sustain your e"ommerce activities in the years ahead4 @ lot 9ill depend on your usiness continuing to thrive and gro94 It is important that e"ommerce can contri ute to gro9th of revenue (and profits) 9hilst not imposing a heavy urden on your cash flo9 or threatening your financial sta ility4 Ideally, the financial enefits 9ill need to e2ceed the financial costs significantly4

@fter analysing your o9n situation, you may decide not to adopt 9e + ased e"ommerce and instead concentrate on other aspects of usiness development or ma6e etter use of cheaper communication technologies C such as mo ile phones C or you may decide to ma6e use of facilities provided y others (Internet cafEs or telecentres) rather than invest your o9n resources in ne9 I"Ts4 "areful analysis of the factors outlined 9ill help you understand your o9n strengths and 9ea6nesses for e"ommerce4 If you do consider 9e + ased e"ommerce to e an essential part of your usiness plan, then ta6e a step+ y+step approach that avoids the pitfalls4 ?ou can ta6e note of the follo9ing tips4 C26 +en +ips *or eCommerce Tip #! @ sound and sta le commercial proposition is a crucial first step4 Fetting carried a9ay y all the e"ommerce hype could cause a loss of control over the e"ommerce venture4 Tip -! ?our target mar6et should shape your usiness planning4 Gemem er, your e"ommerce plans cannot e separated from your usiness plans4 @s 9ith usiness plans, then! a) you should ensure that staff, customers and suppliers have their say, and ) your availa le resources 9ill also influence your plan C ma6e sure the costs can e :ustified y the enefits4 Tip $! Fle2i ility all through the venture is very important for the venture to meet 9ith success4 Which means you simply cannot 6eep 9aiting for technology to catch up4 The venture has to e treated as an on+going process4 Tip *! ;ften, the 9hole venture is controlled y an IT specialist, not sales people4 ;nce a 9e site goes live, the mar6eting team is of utmost importance4 ThatDs 9hen the pu lic 9ill flood the site and no amount of soft9are technology 9ill come in

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handy4 <o an e2cellent rapport 9ith the mar6eting and sales team sets apart a successful e"ommerce venture4 Tip /! Nendors 9ill only deliver the e2act technology or application you 9ant 9hen you properly communicate it to them4 @ lac6 of understanding et9een the user and vendor can cause huge losses in investment and a flagging morale at the end of the day4 @ thorough 6no9ledge of the technology you need and effective communication 9ith your vendors could avoid ig headaches4 Tip ,! "onsidering the outsourcing option is >uite natural and necessary at times, so al9ays 6no9 9hat you need to outsource4 Fauge your in+house talent to see if you meet the re>uirement4 There are plenty of cases of companies, 9ithout the ade>uate 6no9+ho9, having approached consultants 9ho vanish 9hen theyDre in need of ongoing support (9hen the pro:ect goes live)4 <taying in control is a solutely necessary4 Ideally, the IT people should handle the outsourcing contracts and not the usiness department4 Tip .! Bever underestimate the scale on 9hich your site has to operate4 The losses 9ill e 'erculean if a site that cannot support customers comes to a grinding halt4 In spite of 6no9ing the importance of a scala le system, many e"ommerce ventures are not prepared for a, say, #11K traffic increase4 e7usiness sites need to scale rapidly in order to respond to the changes in mar6et and an increasing num er of hits4 Tip 0! Fet as much advice on technical architecture as possi le efore you go live4 (eep a ta on your e2penses as most of the times the udget seems to e e2hausted much efore a certain level of functionality is even reached4 It should not occur that the usiness platforms are up and running 9hile the IT development side has staggered into the ac6ground4 7usiness on the Internet may seem e2tremely easy to egin ut after that it is very difficult to continue if the necessary technology is a sent4 Tip %! More than half of all e7usiness ideas fail to rea6 even4 @ thorough understanding of the 6ey usiness issues is very important, as is a good relationship et9een those responsi le for technology and those responsi le for finance4 IT staff need to use the language of the usiness as e"ommerce ma6es lin6s et9een IT and usiness closer than ever4 The approach to9ards an e7usiness solution should not e li6e that to9ards a pro:ect4 @ good planning approach and sound methodologies should do the tric64 Tip #1! Many e7usinesses forget planning a out security measures from the initial cycle4 This is a grave mista6e4 Most companies ring in the security issue in the end, more as a panic response, after they have e2perienced a mishap4 There are a num er of things that affect security at the infrastructure level itself4 <o getting things to the right places at the right time from the start is important4

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C?6 9hat !ind .f eCommerce; For those 9ho 9ant to get into e"ommerce, the follo9ing chart is a guide to 9hich of the e"ommerce steps 9ould e most appropriate +able 26 Steps to eCommerce 0 9hat !ind of eCommerce;
Steps to eCommerce Step () *eb Inte"ration 'arket Drivers Ge>uirements of main customers and suppliers4 "enefits Merging online and offline processes4 Geductions in operating costs4 7etter relationships 9ith customers and suppliers4 <peed and convenience, ut only a re>uirement if offline transactions not processed effectively4 7etter usiness communications4 7etter mar6eting4 7etter 6no9ledge of mar6et and customers4 7etter mar6eting4 7etter randing4 3asily updated, 9ell presented materials4 "onsidera ly improved usiness communications4 Costs Financial costs of investment in technology, systems and services are very high4 .verall $mpact Nery high costs, ut potential high enefits4

Step +) *eb Transactin"

Primarily driven y re>uirements of customers4

'igh costs of investment in necessary systems and secure net9or6 re>uirements4

Gelatively lo9 enefits, ut high costs4

Step ,) *eb Interactin"

Step 3) *eb Publishin"

Ge>uirements of customers suppliers, colla orators and support agencies4 Ge>uirements of customers and the mar6etplace4

Moderate costs of investment in 9e + ased technologies and net9or6 access4 Moderate investment costs4

Gelatively high enefits 9ith relatively moderate costs4

Moderate enefits and relatively moderate costs4

Step 2) Email -essa"in"

Ge>uirements of customers, suppliers, colla orators, support agencies and employees4 Ge>uirements of customers suppliers, colla orators support agencies and employees4

Moderate investment costs4

'igh enefits and moderate costs4

Step1) Simple -essa"in"

"onsidera ly improved usiness communications4

=o9 investment costs4

Potentially high enefits and relatively lo9 costs4

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CB6 eCommerce *acilitators @ 9ide range of facilitating organisations can offer you different types of e"ommerce support4 This support may range from usiness advice to 9e development or mar6et access4 Different facilitators can play different roles depending on your e"ommerce re>uirements4 When see6ing out e"ommerce assistance you should try to choose a facilitating organisation that is actively involved 9ith your target mar6et and in tune 9ith your usiness re>uirements C as 9ell as your technical re>uirements4 For M<3s in developing countries, facilitating organisations fall into several categories4 @s follo9s! a) Sector:"ased Agents3"rokers Resellers These offer 9e + ased mar6eting activities and tend to e commission+ ased4 They are a le to accept and place orders and they are s6illed at information ro6ering, logistics and supply chain management4 They may also offer Internet transactions and electronic an6ing4 b) eCommerce +rading Hubs or %ortals These are also commission+ ased ut offer solely 9e + ased mar6eting activities4 They are a le to accept and place orders, and 9ill e more li6ely to offer Internet transactions and electronic an6ing4 c) $ndustr& .rganisations "usiness Associations These are usually mem ership+ ased (re>uiring payment of su scriptions)4 They pro a ly 9ill not have detailed e2pertise in e"ommerce, ut can often provide mar6et coordination and information ro6ering services4 d) *air +rade .rganisations They provide mar6et outlets ased on fair trade principles4 Most offer 9e + ased services and mar6eting, and some offer a full transaction+ ased e"ommerce service4 e) #=.s3"usiness Support .rganisations (including +elecentres) Providers of advice, training and some mar6eting assistance4 They are not li6ely to have specific e2pertise in e"ommerce, ut may e a le to offer advice and assistance4 f) $S%s3$+ Consultants They can offer access to net9or6s, 9e development services and possi ly e"ommerce advice and strategy planning4

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@s summarised in Ta le $, you should consider the strengths and 9ea6nesses of any organisation that you consider for support C 9hether or not the organisation can meet your o9n needs C particularly for fee+paying services4 +able ?6 eCommerce *acilitators 0 Strengths and 9eaknesses *acilitating .rganisation Sector./ased A"ents'/ro$ers %ossible Strengths Food mar6et pro2imity, mar6et e2perience and 6no9ledge4 Mar6et access4 &uic6 route to mar6et4 More fle2i ility for producers in the mar6et4 Wider mar6et access4 %ossible 9eaknesses Tend to create dependency relationships 9ith suppliers and tie in producers to sole purchasing agreements4 =i6ely lo9 returns4 =ess security in the mar6et4 Price sensitive4 ;nly purchase and resell4 =ac6 of personal mar6et relationships and contacts4 =imited access to mar6et4 =ac6 of mar6et pro2imity4 Tend to lose mar6et share to commercial importers or agents4 Barro9 mar6et that might e seasonal (high demand at Omas, for e2ample)4 May have little mar6et access, 6no9ledge or pro2imity4 May have technical e2pertise, ut pro a ly little 6no9ledge of the mar6et 9ithin 9hich you are operating4

0esellers

eCommerce Tradin" 1ubs or Portals Industr& 2r"anisations 3air Trade 2r"anisations

@ le to advocate on ehalf of producers4 @ssistance 9ith >uality control and product8service development4 <pecial assistance to 9omen producers4 7etter returns4 Possi le sources of finance or su sidy4 =ocal access to resources4 @ le to offer local technical support

452s and /usiness Support 2r"anisations ISPs IT Consultants

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D6 eCommerce "est %ractice =uides

The guides provided in this section provide direct advice on practical issues that may arise 9hen your implement e"ommerce in your enterprise4 Advice Sheet <4 =etting Connected And 'aking A Start =etting connected4 "onnecting to the Internet is a fairly simple process4 ?ou 9ill need a computer! ne9 personal computers might range in price from around U<M$11 to around U<M#/11 depending upon the type of computer, the soft9are installed, 9here one uys the computer and the 9arranty given4 <ome computing outlets in developing countries also sell second hand+reconditioned computers that could range in price et9een U<M#11 and U<M$114 "omputers can often e purchased using hire purchase (paying y instalments)4 Deferred payment and discounts for cash are availa le4 <ome charita le organisations and BF;s offer computers as gifts to schools and enterprises that cannot afford the purchase price4 ?ou 9ill also need a telephone line and a modem6 @ computer you uy may or may not have a modem fitted4 Thus you should al9ays as6 9hether this is availa le4 ?ou 9ill also need Internet ro9ser soft9are 9hich may 9ell have een preloaded into your computer 9hen you purchased it, ut ma6e sure 9hen purchasing your computer you as6 if it has this soft9are4 Finally you 9ill need to lin6 your computer 9ith a local $nternet Service %rovider ($S%) that 9ill provide you 9ith access to the Internet (and may also provide email, 9e space, etc)4 There are numerous I<Ps in most developing countries mostly located in and around ur an centres4 Most I<Ps provide -*+hour access through a dedicated dial+up num er and 9ill charge a monthly fee4 Ma6e sure you shop around for an I<P4 Starting to use the $nternet4 Ta6e a course or ma6e use of (recent) guides4 <tart using email to communicate and chec6 your email every day4 Investigate local usiness 9e sites and 9e sites of companies in your usiness sector Use 9e search facilities and investigate any usiness portals that cater for your usiness sector4 If you do not have your o9n computer and connection, ma6e use of $nternet CafCs4 Most of these are located in cities or to9ns 9here any individual 9ho cannot afford to o9n a P", ut needs to use the Internet, can have access4 Typical charges 9ill e less than U<M# per hour4 More details concerning the possi le costs associated 9ith developing 9e + ased e"ommerce are contained in @dvice <heet %4

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Advice Sheet 24 ,sing Electronic 'ail (Email) Electronic mail (email) is the e2change of messages et9een computers offering considera le advantages over letter+post and, increasingly, over fa2 communication4 It provides the cheapest, >uic6est and most relia le 9ay to e2change usiness information 9ith customers, suppliers, etc4 9ho are also connected to email4 3mailing re>uires a computer 9ith Internet access4 Furthermore you need some client email soft9are such as Microsoft ;utloo6 or =otus Botes4 The easiest 9ay to use email is to go to a 9e site that offers free email facilities, such as ?ahoo or 'otmail4 3mails arrive almost instantly via the Internet4 ?ou can send DattachmentsD 9ith your email C these may e computer files of any 6ind (documents, photos, sound+clips, or even video clips)4 <ome advantages of email for usiness are! It allo9s a variety of information to e sent C not :ust messages, ut also other types of computer data file including formal usiness correspondence and rochures4 Messages can easily e recorded, to 6eep a record of correspondence4 Messages can easily e organised, e4g4, y uilding up an address oo64 Messages can e protected from outside vie94 Messages can easily e sent to multiple recipients (such as all of your customers)4 <ervices can e accessed y the entrepreneur 9hilst on the move and a9ay from the office4

The main arriers to using email at present are! The investment costs (the total cost of computer8modem o9nership)4 The running costs (net9or6 access)4 The relatively fe9 usinesses in developing countries a le to send and receive emails (although the num er is gro9ing rapidly)4

In order to use email, enterprises need access to an Internet+lin6ed computer4 @s descri ed in @dvice <heet #, o9ning this is some9hat costly ut email services can also e accessed from shared facilities such as Internet cafEs and telecentres4 If you are an e2porter or you are regularly communicating 9ith email+lin6ed customers, suppliers and other usiness contacts 9ithin the region or 9orld9ide (such as in the tourist sector), then email is y far the cheapest and >uic6est means of communication4 It 9ill increasingly e an essential tool for your e2port usiness4

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Advice Sheet ?4 eCommerce Skills When adopting e"ommerce, asic usiness s6ills remain unchanged C 9hat 9e might call the business fundamentals4 They can e summarised as follo9s! @ 9ell+thought+out usiness plan and mar6eting plan4 The a ility to ma6e yourself 6no9n and net9or6 effectively4 The capacity to produce the right product8service at the right price in the right place at the right time4 (no9ledge of your customers and the a ility to meet their e2pectations4 The a ility to pay your ills and get paid on time4 The capacity to e fle2i le yet also plan for the future4

e"ommerce can help to support these fundamental s6illsI for e2ample, y capturing customer information and ma6ing it easier to segment your mar6et or mar6et directly to your customers possi ly using email or 9e + ased methods4 e"ommerce 9ill also open up your usiness to ne- skills and ideas including the follo9ing! Database management6 ?ou can collect information on 9e site visitors C usually customers or potential customers4 Information can e used to target mar6eting efforts and improve customer service as 9ell as forecast future trends in customer ehaviour4 $mproving business processes6 This is a 9ay of analysing the different tas6s 9ithin an enterprise to identify etter 9ays of achieving greater efficiencies4 Gestructuring your usiness 9hilst ma6ing use of e"ommerce may assist your long+term survival and gro9th4 !no-ledge management6 More effective management of information and 6no9ledge 9ithin your usiness can ring enefits4 e"ommerce 9ill help you to improve your s6ills in this area4

The Internet 9ill also help you do -eb:based market research6 7y conducting investigation into mar6et trends and customer re>uirements, enterprises can develop innovative strategies to compete4 The Internet can e used to learn more a out customers, industries, products and services, and mar6et trends4 @s :ust noted, you can also collect information from the people 9ho visit your 9e site, helping you to plan for the future4 The Internet also has specific resources that 9ill assist mar6et research in relation to product development, usiness planning, e7usiness development and mar6eting4 These can e accessed via a num er of the 9e sites listed in <ection 3-4 For those further up along the e"ommerce steps, the Internet may also help you 9ith more advanced s6ills such as Enterprise Resource %lanning (ER%) and 'aterials ReGuirements %lanning ('R%)6 7oth use I"Ts to automate core usiness functions4 MGP is similar to 3GP ut is su stantially cheaper to install and is more suita le for M<3s4 It re>uires computerisation of many aspects of the usiness including accounts, inventory, and purchasing4 7enefits focus on reduced inventory costs, etter stoc6 control, ordering and order fulfilment4

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Advice Sheet B4 9eb Development We sites can e static or dynamic4 Dynamic 9e sites create pages in response to visitor re>uests4 For e2ample, the amaJon4com 9e site uilds its pages according to the types of oo6s that interest specific visitors from information stored in a data ase C a data ase+driven 9e site4 @ simple static 9e site can e designed using 'TM= code instructions plus image files such as HP3Fs or FIFs4 It 9ill typically lin6 a home page to other pages containing information on the enterprise (see diagram)4 The 9e site may include a shopping cart 9here customers can purchase products online 9ith their credit card or 9here offline payment methods are outlined4 To create a dynamic information+ driven 9e site, a data ase is integrated into the site and information can e displayed 9hen someone re>uests it4 The advantage is that the data ase can e updated and changed regularly4 The data ase serving the 9e site may consist of client information, such as account details and sales history and can e stored on standard soft9are pac6ages such as Microsoft @ccess4 ,pdating &our -ebsite4 To update a dynamic 9e site you have three options! @gree an annual fee 9ith your 9e developer for a set num er of changes4 Ma6e the re>uired changes yourself C re>uiring specific s6ills4 7uild an update facility into your 9e site design4 The preferred (and cheapest) option is for an employee C using a username and pass9ord C to e a le to add, modify or delete information on the 9e site using the 9e ro9ser4 "asic 9eb Design +ips4 Pages must display or do9nload >uic6ly4 If your 9e site do9nloads too slo9ly the customer may give up and try a competitorDs 9e site4 Images (photographs and graphics) need more time to do9nload than te2t, so use a small num er of images, repeat the same fe9 illustrations or logo throughout the site, or install a utton on the 9e page, to allo9 the customer to access a te2t+only version4 <hort paragraphs and sentences are the norm 9hen 9riting for the 9e 4 "ustomers need to locate information easily4 Nisitors to 9e sites tend to scan pages rather than read the entire te2t, so signpost the information 9ith clear headings4 Information on the site needs to e organised and easy to find4 =in6s and uttons, 9hich ta6e the visitor to different places on the site, should e la elled4 Most important items should e accessi le 9ith minimal clic6ing4 <ome uttons need to e on all pages, such as! 'ome, <itemap, "ontact Us and <earch4 Important information should e easily naviga le4 We sites also re>uire tailoring for your customers4 "ustomers 9ant to uy products that are descri ed in their o9n language, priced in their local currency, and supported y people they can communicate 9ith4 -0

Advice Sheet >4 .nline %romotion The Internet provides an additional (and complementary) means of mar6eting your products and uilding your enterprise profile4 ?ou should consider use of the Internet alongside other media li6e telephone (such as a help line), radio, and print4 @ 9e site 9ill not provide a solution to all your mar6eting pro lems ut it may ecome as necessary as other forms of media C particularly if your competitors also have 9e sites4 To e effective, 9e sites need to attract the right customers4 @ high proportion of people 9ho visit a 9e site find it through a search engine or directory4 These services present important mar6eting opportunities4 <earch engines generate lists of UG=s (9e addresses) in response to particular >ueries entered y the potential customer4 The sites most li6ely to e visited are those at the top of the list4 We pages, therefore, need to e designed so that they are located high on lists produced in response to relevant 6ey9ords4 ?our 9e presence can particularly assist in the follo9ing t9o 9ays! "randing! "ustomers tend to stic6 9ith tried and trusted rands rather than ris6 uying an un6no9n rand4 @n online rand 9ill e an e2tension of your offline rand4 ?our 9e site needs to integrate your rand into the customer e2perience of visiting the site4 The rand (e4g4, amaJon4com) should e associated 9ith an easy to use 9e site that offers high value in terms of information and services, has a trust9orthy reputation, and is visually appealing4 %ersonalisation! "ustomer information (names, addresses and registration details) can e used to trac6 preferences and tailor the contents of your 9e site to suit individual tastes4 For e2ample, your site can suggest products that a particular customer might e interested in, ased on his or her purchasing history or the pages they have already vie9ed4 The most useful methods of direct promotion to customers are! Email marketing! 3mail is li6ely to e the most cost effective 9ay to mar6et your usiness4 ?ou should add a signature file to all emails4 This is the same as using headed paper or attaching a usiness card4 Most email soft9are ena les this to e done easily4 +estimonials! These are genuine comments that satisfied customers have made a out your products or services4 3ffective use of testimonials uilds credi ility and ma6es customers feel more secure C especially for online purchasing4 3ffective testimonials 9ill e unedited, genuine, freely given, used 9ith the authorDs permission and accompanied y the authorDs name and location4 ;ther online mar6eting methods include! 2iral marketing 0 using your email contact list to spread your details through your contacts lists C y giving an incentive to pass on the message4 "anner ads C adverts that appear on 9e pages4

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Reciprocal links C lin6s to other sites that provide an easy 9ay for a customer to travel from a related site to your 9e site, and vice versa4

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Advice Sheet 64 #et-orking And Communities .n +he $nternet 7y net9or6ing 9e mean connecting computers in order to share information4 @ net9or6 allo9s a small enterprise to share hard9are (printer or a phone line) and soft9are (an accounts pac6age or email)4 The net9or6 may e e2tended internally to include local offices through an intranet or e2ternally to 6ey customers and suppliers forming an eFtranet4 Bet9or6ing a small enterprise 9ould involve lin6ing P"s, printers, fa2 machine, scanners and phone connections4 @ common language or protocol 6no9n as T"P8IP allo9s computers, soft9are and other hard9are devices to communicate 9ith each other4 (<MTP and P;P C commonly used for transmitting and receiving emails C are part of the T"P8IP protocol)4 These protocols allo9 different systems to share data and communicate 9ith each other regardless of the type of operating system or computer used4 For larger net9or6s you 9ill need net9or6ing soft9are such as Microsoft BT or Bovell BetWare4 This soft9are 9ill set up one of your P"s to act as the main server that 9ill hold the enterprise data ase and act as the central point sending (to a printer, for e2ample) and receiving data8information4 !e& "enefits of #et-orking4 Information is shared >uic6ly and efficiently4 'ard9are devices (e4g4, printers) are etter utilised y sharing 9ith other colleagues4 @ccess to information such as stoc6 and accounts can e o tained any time of day from any location4 <uppliers and customers can e included in the net9or6 and efficiencies achieved as a result4 "ommunication 9ithin the enterprise improves overall4 7etter communication can also e facilitated through net9or6ing over the Internet and 9e 4 For e2ample, online communities can open up interaction et9een enterprises and customers and oost other mar6eting efforts4 Bet9or6ing avenues include! e#e-sletters4 They allo9 enterprises to send regular, targeted stories and messages to people 9ho have invited them to do so C a form of advertising4 Email discussion forums4 People can su scri e and then send emails that 9ill e automatically for9arded to all other su scri ers4 People see6ing information can post emails to the forum, and those 9ho are a le to give advice reply4 These are good for accessing technical advice and for stimulating ne9 ideas4 "ulletin boards4 These allo9 su scri ersD emails to e posted in a central location4 Unli6e email discussion forums, su scri ers do not receive any emailsI they have to visit the ulletin oard to see 9hat people are saying4 These can e used in online auctions and for accessing invitations to tender4

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Advice Sheet 74 Contracting .ut 9eb Services The decision 9hether to uy e2ternal 9e services or to develop your 9e site in+ house 9ill depend partly upon udgetary constraints4 @s 9ell as the necessary financial resources (see @dvice <heet %) you should also ma6e sure that you have the e2perience and 6no9+ho9 to do the :o and a clear understanding of your usiness goals and strategy4 When involving an outside firm or individual, it 9ill e necessary to inform them of your re>uirements4 This 9ill also provide a useful chec6list for future reference 9hen the pro:ect is up and running4 @lso, pay attention to the ac6+up service on offer, together 9ith contractual terms and conditions of your potential 9e site developer4 The core ingredient for any 9e site is content4 The presentation and content should e 9or6ed out et9een you and your developer C ta6ing into account the needs of your customers4 The developer should have a clear understanding of your re>uirements4 ?ou could use the follo9ing chec6list for to provide the necessary information for a 9e site developer! @ description of the usiness sector and a short outline concerning any important issues specific to your industry4 "larity on ho9 important the Internet 9ill e to the enterpriseDs future4 The o :ectives for the site4 These should e concise and realistic4 The target audience for the site4 Who is going to develop the contentA Will a 9riter8content editor e re>uired to develop and structure contentA What 9ill the customer to e a le to do on the siteA Will the 9e site facilitate online transactions, reply forms, search >ueries, etcA Will your enterprise re>uire mailing lists and ulletin oardsA What 9ill e the time frame for construction of the 9e siteA 'o9 9ill 9e content e updatedA

?ou 9ill also need to consider 9ho is going to host the site C -ebsite hosting4 @ 9e host provides the necessary hard9are and soft9are to store your 9e site and allo9s access via telephone or other connections4 @ll 9e sites re>uire hosting that typically includes! a one+off fee to a hosting company plus an annual su scription and (if re>uired) credit card authorisation costs4 These payments may e dependent on the e2pected num er of visitors (traffic) to the site4 When choosing a host, relia ility is as important as speed4 Do9ntime C time 9hen your 9e site is not accessi le due to maintenance or some system failure of the host C can e e2pensive for a small enterprise4 <ome 9e site design companies offer turn6ey solutions C all:in:one packages4 These are useful for enterprises 9ith no I"T ac6ground4 They eliminate the need to find specialists supplying different Internet services4 There are increasingly lo9 cost or in some cases free pac6aged soft9are solutions on offer4

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Advice Sheet @4 .rder *ulfilment And 5ogistics ;rder or service delivery tends to e an area of 9ea6ness for many e"ommerce ventures C depending, as it does, on the e2isting transport and supply infrastructure (the D ric6sD rather than the Dclic6sD)4 Poor delivery damages customer loyalty and the enterprise reputation if not handled 9ell4 e"ommerce therefore needs good logistics! getting the correct goods to the right place at the right time, in the right condition 9ith the minimum of cost4 <ome products or services are delivered more easily than others4 7oo6s, "Ds, etc are often ought online ecause they are easy to ship through the post or via couriers4 When a customer uys online they tend to e2pect a etter standard of service4 To try to plan a good standard for your order fulfilment, as6 yourself the follo9ing >uestions! 'o9 are you going to distri ute the goods or services to your customerA What are the delivery options and their associated costsA 'o9 can you improve your response and delivery timesA 'o9 dependent are you on the a ility of others in your supply chain to respond to customer needsA Do you have a strategy for customer dissatisfaction or returnsA @re you a9are of your o9n limitations and those of your supply chainA

The use of the Internet 9ill e more important if you are conducting 7-7 e"ommerce4 @s trade et9een usinesses increasingly moves online, so the processes and services that support this trade, such as logistics and document management, also move online4 Involvement in 7-7 e"ommerce can help small enterprises ma2imise oth internal and e2ternal efficiencies (e4g4, filling e2cess transport capacity)4 3lectronic net9or6s may also open up ne9 9ays of managing the supply chain (e4g4, cutting do9n on paper9or6 and speeding up communications), allo9ing streamlining of usiness operations, reducing costs and improving efficiency4 Some +ips for $mproved .rder *ulfilment4 !eep the customer informed C pro a ly via email4 This is vitally important and may include! confirming the sale, the e2pected delivery date and follo9+ ups to chec6 delivery has een completed4 3ffective communication 9ill help esta lish a relationship of trust 9ith your customers4 With e"ommerce, many of these functions can e automated using off+the+shelf soft9are4 Establish personal contact y telephone or in person if local4 This is especially important 9hen customers have pro lems or complaints4 If you have a telephone num er for customers to call, this should provide human interaction rather than recorded messages4

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Advice Sheet H4 Costs .f 9eb:"ased eCommerce The asic cost components (outlined in @dvice <heet #) for 9e + ased e"ommerce include a computer (P" or similar), an internal8e2ternal modem plus an Internet connection via a landline! @ suita le computer should include the necessary soft9are pac6ages that may e off+the+shelf or free soft9are options4 Typically, an $nternet connection can e achieved in a num er of 9ays! Most popular are dial+up Internet services (recommended for light users) using normal telephone lines through an I<P via a modem4 The modem is usually internally placed in the computer4 ?our local landline provider 9ill charge for every minute you are connected4 There is also an annual charge for dial+up Internet services C perhaps U<M -1+$1 per month4 In addition a set up fee of, say, U<M-/+/1 may e charged, especially for those clients 9ithout internal modems4 In some areas it is also possi le to connect to road and4 7road and offers high+ speed, -*+hour Internet access and does not loc6 your telephone lines during use4 This comes at a high cost, though the cost is falling >uite fast4 Typical costs might e U<M$11 annually for the lo9est and9idth (,*6 ps) up to U<M-/11 and more per year for the high and9idths (# M ps and a ove)4 In addition an installation fee of any9here from U<M#11+-11 may e charged4 .ther .ptions and Additional Costs4 For enterprises that cannot afford their o9n computer and dial+up connection, cost saving options include a monthly8annual mem ership 9ith a local Internet cafE8telecentre4 @dditional costs for 9e development may include! 9e site domain registration (registration of the name of your 9e site), hosting and design, and search engine su scriptions4 For full e"ommerce, other costs may include shopping cart facilities and data ases used to store and manipulate customer or sales information4 Gegistration of a domain (9hich can often e done via overseas domain registration sites) might cost U<M-1+$1 per year4 'osting and maintaining the 9e site 9ill depend on the comple2ity of the 9e site4 @ simple 9e site re>uires at least #/+/1 mega ytes (M7) of storage capacity, and could cost et9een U<M,1 and U<M-11 per year4 We site design costs vary enormously, ut a typical price could eU<M/+#1 per page for a simple 9e site 9ith fe9 graphics4 The cost of a full 9e site could range from U<M/1 to U<M#111 for a relatively simple 9e site4 'o9ever, the price is not fi2ed C it depends on the designer and comple2ity of the site re>uired4 Thus to have a 9e site up and running might re>uire an initial cost of any9here et9een U<M#11 and U<M#111 9ith hosting, maintenance and other su se>uent costs li6e9ise et9een U<M#11 and U<M#111 per year4 Updating costs should e ta6en into account at the design and development stage4 It is possi le either to train a staff mem er to loo6 after the 9e site or to sign a contract 9ith the 9e development company4

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Advice Sheet <04 Some 5egal3Regulator& $ssues The Internet presents ne9 legal8regulatory challenges4 The glo al nature of electronic communications re>uires a glo al vie9 of the legal implications4 =egal issues and ris6s 9ill ecome more severe as you clim the e"ommerce ladder4 @ mar6eting type 9e site 9ill offer fe9er challenges than a fully interactive e"ommerce portal4 ;f critical importance is the location and nature of the target audience and the la9s that are li6ely to apply in the userDs country4 <ome of the 6ey issues are specified elo94 These 9ill need investigating further in relation to specific local re>uirements and concerns4 +erms and conditions of use4 These should e legally incorporated into the relationship et9een the 9e site and the user4 3lectronic contracts have legal validity4 @cceptance of a contract should e recorded in an accepta le manner giving the time and date of each customerDs acceptance (payment, of course, may e made offline in the usual manner)4 It is possi le for users to Dclic6D acceptance of terms and conditions of use 9hen they enter a 9e site or ma6e a purchase4 $ntellectual propert& rights ($%Rs)4 The ease 9ith 9hich electronic content can e copied and reproduced raises issues a out 9ho o9ns material on a 9e site4 ?ou may need to clarify this C particularly 9hen using outside developers or all+in+one pac6ages4 H&perlinking4 This encourages users to move to and from other 9e sites4 In all cases the consent of a third party 9e site o9ner should e o tained, or it may e possi le to e2amine the terms and conditions of the other site you 9ish to lin6 to in order to find out 9hat their policy on hyperlin6ing is4 Data protection4 @ data ase of customers, su scri ers or mem ers constitutes a significant enterprise asset that should e protected4 In the a sence of a frame9or6 of la9 covering these issues, it is up to the enterprise to ensure that its o9n data is protected4 Consumer protection4 There is a gro9ing ody of la9 that offers protection to consumers in their day+to+day transactions and re>uires the disclosure of certain information to consumers4 In practical terms, 9e site operators should ensure that the fundamental ingredients of a contract (e4g4, offer and acceptance) are appropriately dealt 9ith on their 9e sites4 "ertain prior information such as the identity of the supplier, price of the goods, delivery costs, delivery arrangements and cooling+off periods should also e provided on+screen prior to the su mission of an online order4 .verseas Durisdictions4 <mall enterprises are not in a position to o tain legal advice on all the :urisdictions in 9hich their 9e site is accessi le4 Insofar as it is possi le therefore, 9e site operators should see6 to ensure that the la9s and :urisdiction of their country of esta lishment apply to the 9e site4 Therefore, you should chec6 the rules of the country 9here your 9e site is hosted4

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Advice Sheet <<4 9eb Securit& Protecting information from unauthorised access is a critical Internet issue4 It is also the case that the collection, storage and distri ution of information via the Internet is increasingly governed y legal regulation4 The follo9ing points are an e2planation of some asic security measures that can e installed in your computer or uilt into your 9e site! Authentication4 @ common security measure that re>uests the user to login 9ith authorisation details efore allo9ing access to restricted areas of a 9e site4 These details usually include a username and a password) Email securit&4 It is possi le to protect your email messages from snoopers, and ensure that email conversations remain private4 ;ne method is Dpu lic 6ey encryptionD4 This technology transmits email messages in a code or cipher, and decodes them at the other end, ma6ing it possi le only for the recipient to read them4 @n encryption facility should e availa le as part of your email soft9are (e4g4, on M< ;utloo6 32press)4 *ire-alls4 These are security systems that protect the information contained in your computer system from outside hac6ers4 Fire9alls are particularly useful for protecting a usiness net9or6 that sends and receives emails, transfers data over the Internet or connects 9ith outside computers4 Digital certificates4 @ digital certificate is confirmation y a respected third party that the client company is legitimate and can guarantee security of a financial transaction4 When a customer goes online and decides to uy something the 9e ro9ser chec6s to see if a 9e site has a digital certificate4 If the re>uired confirmation is detected, the vendorDs site server is accepted and the visitor is a le to shop 9ith peace of mind4 Digital signatures4 @ com ination of services that allo9s you to electronically sign a document and affords the recipient the opportunity to authenticate the signature4 @nother security pro lem is viruses4 "omputer viruses are passed from computer to computer via Internet do9nloads, email attachments, shared dis6s, and shared files4 "aution should e e2ercised 9hen e2changing information et9een computers and do9nloading from the Internet4 Well+6no9n suppliers of anti+virus soft9are include <ymantec or Mc@fee4 More advanced security measures ecome necessary 9hen transactions are conducted over the Internet such as through the use of credit cards! These include public ke& infrastructure (%!$) and Secure Sockets 5a&er (SS5)4 These are methods of encryption 9here y the recipient of a ciphered message unloc6s the code y applying a mathematical 6ey to it4 In addition to standard authentication procedures, <<= uses encryption coding to loc6 in client information and is the industry standard 9here online credit card transactions occur4

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Advice Sheet <24 .pen Source Soft-are ;pen source typically means that the soft9are code (the underlying computing instructions) can e read, re+distri uted and modified, independent of the people that created it4 @ 6ey enefit of the open source system is its potential a ility to reduce soft9are costs as it is usually free to o tain and saves on licence costs4 It also allo9s you to upgrade your usiness soft9are at your o9n pace, rather than having to 6eep up+to+date 9ith commercial soft9are upgrades4 The oundaries et9een open source and proprietary soft9are (such as Microsoft) are ecoming muddied, as proprietary soft9are adopts some open source standards and often freely pu lishes its o9n formats4 The choice et9een open source and proprietary systems comes do9n to 9hat is right for your usiness! you may 9ant to loo6 at 9hat other usinesses in your field use ut there are a num er of e"ommerce+ related open source products no9 availa le4 Potential enefits of open source include the follo9ing! ?ou can get some open source soft9are free y do9nloading it from the Internet4 3ven if you purchase tailored pac6ages from third parties the initial price can e much cheaper than for proprietary soft9are4 There are no copyright costs C you are free to copy and distri ute open source soft9are to additional users4

Potential costs! For commercial use, open source soft9are may need more s6ill 9hen it comes to installation and management than proprietary products4 @lso if a part of an open source system lets you do9n, it can e hard to 6no9 9here to turn for help4 ;pen source may save on some initial costs ut for many usiness costs related to e"ommerce C gathering data, training staff, changing the 9ay you 9or6 C it has no cost advantage4 The installed ase of most open source soft9are is smaller than for dominant proprietary pac6ages, so it can e harder (or more costly) to o tain support and training4

;ther factors depend on the particular soft9are4 For e2ample, choosing open source may mean you are not tied to a particular soft9are producer, ut it may tie you in to one particular local support firm4 ;pen source might provide greater relia ility, attention to security, and capacity for customisation to your e"ommerce needs4 ;r it might not C it all depends on 9hich particular open source and 9hich particular proprietary soft9are you are comparing4 ;verall, open source is a useful option that you should consider 9hen implementing e"ommerce4 7ut you should gather information and local opinions a out it first4

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E6 ,nderstanding 'ore About eCommerce

E<6 =lossar&3Iargonbuster "ro-ser @ ro9ser is soft9are that allo9s your computer to access and display 9e pages4 34g4, Microsoft Internet 32plorer or Betscape 7ro9ser4 Communications 3very net9or6 re>uires some 9ay to transport information from one point to the ne2t C that connection may e physical such as Dt9isted pairD or Dcoa2ialD ca le, or 9ireless such as mo ile, micro9ave, radio or satellite4 The capacity of a connection to carry data is called its bandwidth4 Domain names (e4g4, 9994amaJon4com) @ domain name is the address at 9hich a 9e site is located on the Internet4 3ach 9e site has a uni>ue domain name, 9hich must e registered4 @n e2ample is 6com, the most glo ally recognised, and the most suita le if 9ishing to trade a road4 Digital Descri es the 9ay in 9hich data is transmitted C as #s81s C y computers and modern phone lines and mo ile phones4 "ontrasts 9ith the old DanalogueD method of transmission4 Director& @ collection of computer files stored in one place4 ED$ 3lectronic Data Interchange! computer+to+computer e2change of electronic documents for usiness4 Email The transfer of messages et9een computers4 *ile When 9or6 is done on a computer and then stored on a dis6, the result is a called a file4 =S' Flo al <ystem for Mo ile communications! a digital phone net9or6 standard4 Home %age The first page you see 9hen you connect to a 9e site on the Internet4 H+'5 'yperTe2t Mar6up =anguage! a computer language used to create 9e pages4 H&perlink @ connection lin6ing one 9e page to another 9e page via the Internet4

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$C+ Information and "ommunication Technology! electronic means of handling digital data such as computers and the Internet4 $nternet World+9ide communication system C a net9or6 of net9or6s C that connects computers and allo9s them to e2change data4 $S% Internet <ervice Provider! a company that provides you 9ith access to the Internet4 'odem Modulator8demodulator! a device that allo9s computer signals to e transmitted over traditional (DanalogueD) phone lines4 #et-ork "omputers :oined together so that they can communicate 9ith each other4 @ local area net9or6 (=@B) covers a single uildingI a 9ide area net9or6 (W@B) covers a roader area, typically lin6ing computers in different to9ns or countries4 %rotocol In a net9or6, information is sent or passed do9n the connection from one device to another in Dpac6etsD or loc6s of information4 This 9hole process of sending loc6s of information in pac6ets is controlled y net9or6 protocols (e4g4, T"P8IP)4 Search Engines <earch engines are tools that ena le people to search the 9e Ds pages for specific information or 9e sites4 DFoogleD is among the most popular4 Soft-are The instructions that ma6e a computer 9or64 @ particular set of instructions that performs a function is called a program4 If offered for general sale, this is proprietary softwareI if produced for a single, specific customer, this is custom software4 +raffic The num er of visitors a 9e site receives is 6no9n as its traffic4 9eb Directories Directories perform a similar tas6 to search engines in that they hunt for information on 9e sites4 @mong the most 9ell+6no9n directories is ?ahoo4 9orld:9ide 9eb (999) @ collection of lin6ed documents (pages) connected via the Internet4 The pages can hold 9ords, pictures, sound and video4 9ebsites "ollections of pages created and maintained y a company, organisation, or individual4 The sites are found via the Internet and so are accessi le from any Internet+lin6ed computer in the 9orld4

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E26 *urther $nformation 0 9eb:"ased Sources @ selection of online information a out e"ommerce for enterprise development from glo al sources is listed here!
http433---6agri-atch6com3 32ample of an (Indian) information portal and agriculture eMar6etplace4 The site offers the latest ne9s and mar6et updates, research reports and directory en>uiries4 http433---6catgen6org3 "atFen is free 7-7 and 7-" e"ommerce catalogue soft9are offered y the BF; P3;P=in6 for M<3s4 M<3s can choose to open different accounts4 <ervices cost et9een U<M#1 and U<M/14 There is an email helpline as 9ell as language options and e2amples of catalogues y M<3s in developing countries4 <ee also! http433---6peoplink6org3 http433---6ecomlink6org3 3comlin6 is a 6no9ledge+management gate9ay supporting enterprises in developing countries in the esta lishment of e"ommerce and e7usiness4 http433---6ecommBdev6org3 e"ommerce for Development 9e site on 9hich this hand oo6 can e found4 http433---6ecommerce:guide6com3 @n e"ommerce+focused source for independent, up+to+ date information on e"ommerce4 There are daily ne9s feeds, editorials, product descriptions, case studies, discussion forums on e"ommerce, and lots more4 http433---6g77tin6org3 The Trade Information Bet9or6 portal is a <outhP<outh initiative y "ham ers of "ommerce in the F.. <tates4 It provides usiness information on #$$ countries and pu lishes offers for e"ommerce training and services as 9ell as serving as a data ase for 7-7+contacts et9een <M3s in developing countries4 ?ou can do9nload e"ommerce training material from the site4 http433---6it:ab6net3 Focuses on IT usage in <outhern @frican usiness ut reaches out to other @frican and @sian regions4 http433---6line>66com3 =ine /, is a source for glo al information on e"ommerce technology and strategy4 ?ou can find information on every part of e"ommerce and e7usiness, including company profiles4 http433---6nfib6com3page3pgJ200B0>27BBH6??6html U< Bational Federation of Independent 7usiness page of guides on e"ommerce4 http433---6smetoolkit6org3 The <M3 Tool6it from the International Finance "orporation includes a Technology section 9ith pointers on e"ommerce4 http433r06unctad6org3ecommerce3 UB"T@D reports and policy analysis on e"ommerce4 http433-ebmonke&6-ired6com3-ebmonke&3e:business3 We Mon6ey offers concrete procedure descriptions (Lho9+toL+listings) 9ith practical hints for the esta lishment of your o9n e7usiness 9e site4

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