• home
  •  

    Using Technology: What Exporters Say

     

     
     
    © International Trade Centre, International Trade Forum - Issue 3/2003

    When developing e-trade strategies, governments should be in touch with their exporters' needs. Surveys are a good place to start. Here we look at results from interviews with European and North American exporters.

    Forrester Research, a consulting firm specializing in e-commerce issues, interviewed over 50 executives of multinationals in 2000 and 2002. They asked about current use of the Internet and plans for the next three years, focusing on areas that Forrester previously identified as up and coming. They also asked what exporters considered the biggest barriers to trade using the Internet. In a separate exercise, they researched countries that are strong users of technology in import-export operations.

    The research results are available on the following pages. Below we highlight points of interest for Trade Forum readers.

    Exporting with the Internet

    The vast majority of exporters surveyed - 82% - are using the Internet to support export operations. When asked whether the Internet would be part of their future export strategies, only 8% thought it was unimportant.

    The future of "e" for exporters

    Forrester asked executives about the export activities that they plan to conduct online. According to Bruce Temkin, Research Director of Forrester Research: "The Internet's worldwide presence, standardization of interfaces and market pressure will push the exporting community to invest in technology to advance efficiency in three key areas: finance, compliance and transportation."

    Most planned to look first at streamlining transportation management. A substantial minority considered online applications for tracking "border" costs such as sales taxes, customs and tariffs - which Forrester refers to as "compliance". Some were planning to upgrade or create online payment and settlement systems.

    Transportation. Most plan to use Internet technologies to tighten transportation management, with 69% planning shipment tracking, 62% planning logistical coordination and 47% planning for transportation procurement.

    Compliance. Just over a third (27%-39%) plan to use online services to track duties, product classification and standards, among other things. Technology applications focus on gathering and systematizing relevant data for sales taxes, customs and tariffs so that customers can get more accurate estimates.

    Finance. Only a third plan to deal with online financial issues (22%-34%, depending on the issue). Examples of investments in finance applications are those that check credit-worthiness of buyers, extend credit lines, handle payments and automate financial documentation.

    What is the biggest hurdle? Without contest, it is legacy integration - firms that invested heavily in customized, expensive applications are reluctant to invest further in making new applications fit with existing systems. New technology costs are the next biggest barrier.

    Who's in e-business?

    Forrester predicts that countries with companies that are e-trade leaders will dominate overall trade on the Internet, based on a survey of 50 executives at global firms and industry-specific e-marketplaces.

    "By the end of 2004," notes Temkin, "19 e-extrovert countries will dominate international trade on the Internet, representing over 80% of online imports and exports. Their companies will create the international infrastructure and standards for online sales, sourcing and supply chain management".

    Whether extrovert or introvert the countries shown on the chart are all players in the e-trade game. Even the e-introverts are well positioned to benefit from new export opportunities stemming from the application of technology. While only a small sample was surveyed, the impressions are from industry executives "in the know".

    Developing countries need to be aware of e-marketplace trends. "E-marketplaces need to be designed to suit the needs of small firms in the same industry or in the same geographic region," notes Nikolai Semine, Chief of ITC's E-trade Development Unit. "Understanding the power of e-marketplaces is the major challenge for e-trade strategy-makers," adds John Gillies, a Senior Trade Training Officer working with the E-trade Bridge programme. He believes that many useful conclusions can be drawn from Forrester's research, for application by small and medium-sized firms.

    E-winners, E-usersby Forrester Research


    Source: Forrester Research Inc.




    Source: Forrester Research Inc.




    Source: Forrester Research Inc.




    Source: Forrester Research Inc.




    Source: Forrester Research Inc.



    Natalie Domeisen is the Editor of Trade Forum magazine.