E-commerce strategies for SMME sustained growth in the manufacturing sector

Abstract

The South African manufacturing industry landscape has changed due to the pressures of globalisation and liberalisation of trade policy regimes. The structural shift of this industry has led to a global market in which many small businesses in the manufacturing sector find it difficult to compete with competitors for example, in Asian countries. Companies are required to improve their competitiveness by using various strategies such as e-commerce. However, these strategies are changing economics, markets, industry structure, products and services, the flow of products and services, consumer segmentation, consumer values, consumer behaviour and labour markets. An e-commerce strategy could assist small businesses in emerging markets to streamline their business processes in their respective sectors and industries, thus enabling them to enhance their business activities. Yet, literature reveals that most SMMEs do not take full advantage of e-commerce applications in their business activities. A qualitative approach using a case study methodology is used for this research. The researcher adopted models such as the Technology-Organisational-Environmental model, a value proposition model and a key assets model to collect and analyse evidence to propose guidelines for e-commerce initiatives in the selected environment. The findings indicate that SMMEs could improve their performance by establishing formal strategies and structures to increase their worth. This is done by creating e-commerce strategies to fit their organisational goals and objectives. Furthermore, manufacturing SMMEs need appropriate online platforms to transact and build strong relationships with suppliers, customers and partners. In addition, it is essential for SMMEs to establish and monitor quality standards in their e-commerce activities. It was found that the key assets needed by SMMEs in the manufacturing sector could impact their ability to sustain their business activities. Finally, manufacturing SMMEs need to deliver targeted and contextual marketing messages to help influence potential decision makers. This research contributes to the field of e-commerce by providing guidelines which manufacturing SMMEs could use as a starting point, to understand and improve their current e-commerce strategies and sustain their business growth.