Enabling Indian SMEs to take on international markets
Gloves for America’s favourite sport - baseball - are sourced from North India. Star footballers have scored some of their most memorable goals with footballs made in Jalandhar. Handcrafted shoes from small towns in India are making a fashion statement across runways in Europe, the US, Latin America and Africa.
While our country’s diverse craftsmanship has been leveraged by several SMEs within the country, many are yet to wake up to the opportunity that exists globally. In fact, at present, only a small percentage of India’s 50-million-plus SMEs trade globally.
Indian SMEs are extremely significant to the economy, contributing approximately 45 percent to our GDP[1]. In fact, they are increasingly emerging in Tier II, III and IV markets, aiding widespread development across the geography.
While catering to customers internationally may seem like a daunting task to many in the past, the increasing internet penetration and the rise of cross border ecommerce platforms now make this an easy proposition. These platforms enable players – big or small - to sell anything ranging from sports goods to confectionaries. One does not need to worry about the scale or physical presence anymore. In fact, reports suggest that in the years to come, cross border ecommerce will grow at twice the rate at which domestic ecommerce does, and much ahead of the traditional retail market[2].
Google’s Consumer Barometer indicates that the need for better product availability, more attractive offerings, and trust in particular brands are the main reasons why people are increasingly opting for cross border purchases. The guarantee of a hassle-free experience is also critical to a customer, considering the seller may be located thousands of miles away. This is where logistics plays a key part in ensuring that SMEs can participate in global trade, meet global delivery standards, offer convenience to consumers, and thrive internationally.
With leading logistics players having an extensive footprint, businesses can now spread their wings far and wide. Entrepreneurs need support from a strong logistics partner who possesses the know-how of global trade as well as local expertise to manage the entire shipping process. This will allow them to focus on their business, instead of figuring out the complex export ecosystem. For shipping of goods to be seamless, there are several aspects one needs to consider such as trade policies, customs regulations, taxation, licenses and payments. The regulations and paperwork involved can be overwhelming for an SME to take on single-handedly, which is why, handholding them through it is essential, and can be best done by a logistics company.
In addition to facilitating a seamless trade process for SMEs, it is also the job of logistics players to ensure that the needs of the end consumers or the buyer are prioritised. ‘Convenience’ is extremely important in this context. Once a purchase is made, buyers do not want to be hassled with delivery issues. Cases of lost shipments, deterioration in quality, and late deliveries are unacceptable. Here is where logistics players add value.
It is also important to take note of evolving customer demands. The speed of delivery is a given. Customers can now have a say in how their shipments are delivered. In fact, they can schedule a delivery at a time convenient for them, or even put a shipment on hold if they are away on vacation. The logistics sector can empower sellers through offerings that allow them to stand out in the eyes of the end consumer.
With multiple sellers vying for customer attention, strong logistics support will play a significant role in winning customer loyalty. Indian SMEs must, therefore, consider this aspect to add value to their overall offering so that they can successfully participate in international trade and maximise business efficiencies.
[1] MasterCard's 'Micro Merchant Market Sizing and Profiling Report'
[2] ‘The 21st Century Spice Trade: A Guide To The Cross-border E-commerce Opportunity’ by DHL
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)