In our country, Guatemala, unfortunately, the government does not have an agency, specially designed and focused in the export strategy of the country as a whole. AGEXPRONT (Asociación Gremial de Exportadores de Productos No Tradicionales) a private sector association of non traditional products exporters, has taken a leading role in developing a national strategy in this matter, resulting in a growth from $100 million to $1,300 million a year in exports of its represented products, during the past ten years. All this has been accomplished without any public funding.

We are very much interested in sharing our plans to get feed back and avoid mistakes already made by some one else. We are still involved in development, therefore all information possible to be acquired in the Executive Forum 2000, will be of great value to us.

E-commerce is new to the business community in Guatemala; exporters as well as businesses selling locally are recently getting involved in this activity, thus it is very soon to measure their success or failure. However, Guatemalan companies have long been using the Internet to acquire new clients and thus increase sales and diversify markets. In this essay, we cover the development of companies involved in e-commerce, we detail the experience of export companies advertising on the web and we outline a series of activities by which AGEXPRONT is planning to support exporters in their business activities on the World Wide Web.

As early as 1997, Guatemalan exporters have been involved with the Internet using it for different purposes such as communicating with clients, advertising products, and gathering market information. During all these years, AGEXPRONT has played an important role in Internet training and proving a means for export companies to be exposed in the web.

The most widely used Internet tool by Guatemalan companies, doing business abroad, is email. As far as advertising is concerned, although some entrepreneurs started very early building a presence on the web, to this date the percentage of Guatemalan export companies with a website is low. A recent survey revealed that only around 10% of local export companies have a presence in the World Wide Web. E-commerce on the other hand, has aroused a lot of interest among Guatemalan exporters, however much disinformation by local ISP’s has limited companies from getting involved in the right area of electronic commerce. Regarding market research on the web, very few export entrepreneurs in the country are taking advantage of the market information available, some say the language is a barrier and many agree that it is to time consuming and complicated.

For the purpose of supporting this essay AGEXPRONT conducted a survey among 14 of its members that currently have a website. All of these companies agreed their Internet presence has supplied many benefits. While it has become an effective, low cost advertising tool to the majority of them, others say it has also built an element of prestige to their image. But the most valuable benefit to Guatemalan exporters has been the ability of websites to capture new clients.

All exporters in the survey agree that web presence has become an essential advertising tool. Some companies have gone as far as omitting the use of print material and are relaying on the website as their only means of advertising. The majority of export companies interviewed still invest in printed catalogs and brochures however, said the website has become an excellent complement, supplying buyers with more detailed information, and in so pulling customers closer to a sale. Although all interviewees include their URL in the company’s printed material, some have been more creative than others, resulting in higher visits from buyers; for example one company includes the URL in packaging, while another has made it the center stage in trade shows.

Although the use of websites as an advertising tool has added many benefits to export companies, what local entrepreneurs expect by having an Internet presence is to capture clients solemnly by these means. All companies in the survey have been contacted by potential clients, that find their homepage searching on the web, however not all of them have been able to translate these visits into sales. From the 14 companies interviewed, only 8 have been able to close sales. Companies successful at selling to online clients include high search engine placement, detailed content in their websites, a domain name that relates to their product, and special ad campaigns about their websites in trade and advertising activities.

A determining element for Guatemalan companies in capturing "web" traffic has been to rank high in search engines. Of all the companies that have high placement, only half of them understand the importance of it, but none monitor their placement month to month. On the other hand, none of the companies interviewed has ever engaged in subscribing their homepage but rather let the ISP’s do this work.

Another element related to increased traffic among these export web pages, has been to choose a product rather than the company’s name as their domain name, only three of the companies interviewed adopted this strategy. Also companies that expose their URL’s in printed material or that devote special ads to promote it have a much higher traffic rate.

Of the 8 companies that have been able to close sales with "web" clients, only four have significantly added to their profits. When reviewing these companies we concluded that their content had enable them to close more sales than other companies, that rank as high in search engines. We found that these companies had a detailed description and pictures of products, company experience, advantages and references of clients.

The survey also revealed that export companies are not aware of the importance of linking their homepage in trade directories. Only one of the exporters mentioned as having monitored its participation in the Exporters Directory of AGEXPRONT.

Aside from developing a homepage and using email, exporter’s involvement in other areas of the Internet is very limited. The survey revealed exporters have limited or no knowledge of how to promote their products in other applications using the Internet. We also reviewed several trade lead sites and news groups such as marketag.com, tfte.com and found no companies from Guatemala offering their products.

As far as the use of this technology to research markets, only four of the companies interviewed, indicated to use it in a consistent way. The majority agreed to be time consuming, while others argued that language was a barrier and many indicated they had not found anything that related to their market of interest.

Regarding e-commerce there is very limited knowledge among exporters about applications that adapt to their businesses. More than 85% of respondents in this survey have heard about e-commerce but don’t see how it can relate to their export activity. In general, there are very few companies in the country engaged in e-commerce at the time, however there is a higher number trying to sell online to local consumers. We found 7 companies that plan to sell online or that are currently doing so to local consumers, also we interviewed two companies that charge online to overseas customers but deliver the goods locally. As far as International selling and shipping we found two companies of which one stopped the online selling a few months ago.

Among the companies that are selling to on line local customers is a software provider and a photocopy and printing shop. Both companies have recently engaged in this business and so it is to early to measure their success or failure, however both have registered online sales and expect to increase them in the long run. On the other hand, among those companies planing to engage in the online local business are a CD distributor, a pizza business and another printing shop. All three companies have no market research to backup their decision of developing an online shop, but rather took the initiative out of the perception that it is a "very good business abroad". The truly successful local companies engaged in e-commerce, are those selling local goods to expatriates. In this transaction Guatemalan goods are bought online by expatriates and are delivered locally to their families. Both companies agree these online shops have resulted in very profitable business. Both companies believe the success of their operation relays on selling to high-income customers, without the problem of international logistics.

n the other hand we interviewed two handicraft companies involved in selling directly to customers online. One shut down its online operations, after two years, being its most important reason the fact that consumers approaching the site came from a market that they were unable to supply at an individual level. This company has a warehouse in the US and so it was no problem to ship out individual items if orders came from this market, unfortunately orders came mostly from Europe and South America. The reason why he was unable to fulfill orders from other markets outside the US was for the high shipping and customs costs, which would have made the product outrageously expensive. He also added that if he did not have a distributor in the US he would have not decided to sell small orders.

Another company that will soon open an online shop is another handicraft exporter. This company has had a website for more than three years and in this time has received several orders from individual customers located at a market that he can provide small orders. Again, the reason for the company to engage in selling to consumers’ abroad is the advantage of a warehouse in that market. Otherwise they said, it would be impossible for cost reasons to sell to individual consumers shipping from Guatemala.

AGEXPRONT has been an important source for export companies involved with the Internet. Not only has the entity provided companies a means to be exposed on the web, but also has supported exporters in Internet training and has developed a series of online information services. In 1997 the entity built a website which has contributed enormously to promote the institution as well as the exporters. Since its inception, this site included institutional information as well as the directory of exporters. As the entity became aware of the big audience the directory was generating, it decided to invest in an online database, which allowed for better administration of the exporter’s data.

As the use of Internet started to expand among exporters, AGEXPRONT developed a series of training and information services to guide them in their journey through the information highway. Also the entity saw the opportunity to supply market information through this channel. Three services where developed around mid 1998: trade leads on line, courses to introduce exporters to the Internet and a library of links.

When Internet was first introduced to Guatemala, many of our members had difficulty in learning how to use the system, it is at this time that AGEXPRONT started developing short courses to support export companies in the use of Internet. Today most companies have acquired a good knowledge of Internet use, however they still need guidance in finding the right places that provide useful market information. With this need in mind AGEXPRONT constantly organizes short seminars that teach exporters how to conduct market research on the Internet. Additionally the entity has a section on its web page called Library of Links where we recommend the sites that can be of value to exporters. Exporters agree this service has enabled them to find the market information they need at less time.

The service of trade leads online allows members to retrieve from the website trade leads submitted by commercial attaches or by overseas companies. Not only can exporters see the latest leads, but also they can search for older submissions by product, date and company name. This service has allowed exporters to respond faster to overseas buyers looking for Guatemalan goods.

In terms of promotion, the entity subscribes the home page to search engines constantly and also includes the home page in several trade directories and links it to websites of trade organizations and other websites related to the institution.

Also the entity is using the Internet to retrieve information that can be of use to exporters. In 1998, AGEXPRONT started developing market studies custom made for members, using the Internet as the main source of information. Additionally, trade leads posted in different bulletin boards and news groups are retrieved and provided to exporters by email. In this way exporters are provided with two sources of trade leads, from trade commissioners and those retrieved from the Internet.

In the last four years, the entity has greatly contributed to the exporter’s involvement with the Internet, however foreseeing the importance that this technology, especially e-commerce, will have on International business, AGEXPRONT has prepared a number of new services and activities related to the Internet. This new strategy was developed according to the exporters needs and researching the services offered by leading export associations.

In the last three months the entity has changed the content and design of the website in an effort to supply better information for both the exporter and the foreign buyer. Specific details about products and production are supplied, as well as all the investment and business regulations concerning exporting. We are also in the process of changing our directory of exporters so that it reveals, additionally to company contact information, details of companies such as export destinations, years of experience, number of employees, current product offers, etc.

Additionally to trade leads and the library of links, we plan to include in the homepage information regarding International trade shows, trade missions, a guide for first time exporters, a section about trade agreements and our entire trade magazine. We also plan to sell some information on the web such as international statistics, international regulations, market studies, market briefs and other reports. Online training and assistance is also part of our Internet strategy. The entity is constantly developing technical and market information seminars, and members have expressed interest in receiving some of the courses through the Internet.

High search engine placement is a priority in the new Internet strategy. Although AGEXPRONT now appears in search engines, it only does with broad words such as Guatemalan exporters. The entity will strive to locate the homepage in search engines with the most specific products of exporters, in an effort to expose members more efficiently and thus help them acquire new clients trough the web.

Additionally to locating AGEXPRONT’s homepage high in search engines, the association is determined to better inform members about key elements when building a successful homepage. Through information on the web page and small workshops, AGEXPRONT plans to teach exporters how to build appropriate website content, how to choose the right domain name, how to promote URLS outside the web, and also how to subscribe successfully to search engines.

In E-commerce, information will be the most important contribution of AGEXPRONT to members. As we mentioned before, there is a lot of confusion regarding electronic commerce, most export entrepreneurs relate it to selling directly to consumers. Although a small portion could get involved in Business to Consumer e-commerce, the majority would greatly benefit from participating in the different business-to-business "portals".

For those companies suited to develop business to consumer applications, AGEXPRONT is planning to adequately inform them through the home page and small workshops, about the latest trends in this market. We have gathered some information, however we need to research further and locate experts in this area to adequately guide exporters. Not only is the association interested in supplying the current trends of b2c, but also would like to guide exporters in the logistics of the process. AGEXPRONT is planning to survey a number of Central and South American companies already selling to overseas consumers, to establish a correct pattern of logistics for Guatemalan companies.

Regarding business-to-business e-commerce, the entity has determined not to engage in a b2b application, not only for the high cost of development and promotion, but also because this technology is advancing at such a pace, that the association would never be able to have the latest applications. Instead, AGEXPRONT plans to promote and if possible have a relationship with the many companies involved in b2b portals. AGEXPRONT has already located the most important portals in the market and is planning to contact them so together they can promote the use of these applications among Guatemalan exporters.

Having exposed the status of Guatemalan companies in terms of Internet, and the present and future efforts of AGEXPRONT to support exporters in their use of this technology, we are awaiting the advise of an entity like yours that can help us achieve our strategy more efficiently.

A. Number of years with a website

C. Average of emails from prospective clients each month

D. 8 of the 14 companies interviewed are selling to clients that found them on the web

E. Countries or regions from the emails received by export companies

* The respondents that indicated the US as origin of the emails , expressed that although they received from other countries, the majority came from this country.

* In Europe the countries that respondents mentioned when they detailed countries are Germany, Holland, United Kingdom and Spain.

F. Frequency of website updates

7. Only 1 of the 14 companies interviewed promotes the website in Trade Directories

H. Means of promoting URL’s outside the Web

I. No companies have used bulletin boards or news groups to promote their products

J. 6 out of the 14 companies interviewed use the Internet to research markets

k. 12 out of the 14 companies interviewed have heard about e-commerce, however 8 of those aware of this application don’t think it is something they can use for their business. Four are planning to implement business to consumer applications and one is planning to enter a b2b "portal".