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Cross-border e-commerce - Cuneyt Erpolat @ eCommCongress 2018

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How the B2B e-commerce is changing? What is the role of alibaba.com ? How we will make business in the future - in the presentation of Cuneyt Erpolat - country manager Alibaba.com Turkey.

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Cross-border e-commerce - Cuneyt Erpolat @ eCommCongress 2018

  1. 1. Cüneyt Erpolat Alibaba.com Country Manager - Turkey
  2. 2. What IsAlibaba.com? • Companies of all sizes • Entrepreneurs, e-retailers, buying agents, MNCs, etc. • Diverse end markets • Typically small businesses • Ten to a few thousand employees • Thousands of product categories in 40+ industries A global network for buyers and suppliers of raw materials, component parts and finished goods Global BuyersGlobal Suppliers
  3. 3. Alibaba.com Story
  4. 4. TheAlibaba Story 18 years later, Alibaba Group has become a diverse e- commerce company with a family of Internet-based businesses Employees: More than 55,000 Offices: Head office in Hangzhou plus more than 70 offices in mainland China, Hong Kong, Taiwan, India, Singapore, U.S. and U.K. 1999 2017 Employees: 18 Office: Jack Ma’s Hangzhou apartment
  5. 5. New World Norms
  6. 6. What Kind of a World do We Live in ?
  7. 7. What Kind of a World do We Live in ?
  8. 8. Doing the exact same thing over and over again but expect to get a different result Will it ever work ?
  9. 9. Key Word ?
  10. 10. WE NEED TO START CHANGING THE WAY WE DO BUSINESS TODAY
  11. 11. Eg: World is Going Mobile
  12. 12. The most pressing challenges for SMEs to survive Declining prospects / orders Soaring prices of raw materials Inflation Affected supply chain Continuous changes in new markets
  13. 13. 65% of online SMEs have confidence and capability to survive from uncertainties, while only 10% for offline SMEs. Surrounded by great uncertainties, successful rate for SMEs who do business on ecommerce online platforms is 5 times more than those offline. I-research report shows: E-commerce offers advantages that include the ability to expand into global markets with a minimum of expense.
  14. 14. B2B Numbers
  15. 15. 2013 Global E-Trade Volume, Trillion USD Dollars Source: Frost & Sullivan, Emarketer § Global E-Trade volume doubled up between in 2016 when compared with 2013. Global E-Trade Volume 1,08 1,32 1,59 1,95 2014 2015 2016
  16. 16. 6,70 3,20 9,90 +109% B2B ToplamB2C § On year 2020 B2B volume is expected to be nearly two times of B2C volume 2020 B2B, B2C Volume Projection (Trillion USD) 18 Kaynak: Frost & Sullivan Global E-Trade Volume (2020 Projection)
  17. 17. 19 Power of ecommerce
  18. 18. TOP Global E Trade Volumes ( 2016 ) Top 5 Countries for E-Trade volume 1 Trill USD 396 Bill USD 166 Bill USD 124 Bill USD 107 Bill USD
  19. 19. Source: Information Industry Association 2015 Report, EIU, Euromonitor, Statista, IMF, Global Web Index Q1 2016 Online retail/ Total Retail Internet Penetration England %12,6 %92 USA %9,2 %88 France %6,8 %86 Japan %7,2 %91 Spain %3,3 %80 Italy %2,6 %65 China %9,7 %51 Poland %6,8 %71 Brazil %4,1 %64 Russia %3,8 %71 India %1,9 %27 Turkey %2,5 %62 Germany %7,9 %88 E-commerce comparison Developed countries’ average 7,1% Online Shopping %77 %66 %64 %55 %57 %49 %44 %53 %44 %48 %23 %39 %74 GDP per Capita (PPP) $ 41,2 K $ 55,8 K $ 41,2 K $ 38,1 K $ 34,8 K $ 35,7 K $ 14,1 K $ 26,5 K $ 15,6 K $ 25,4 K $ 6,2 K $ 20,4 K $ 46,9 K Developing countries’ average 5,1% ... Developed countries ... Developing countries 8 E Trade Penetration
  20. 20. -2 0 2 4 6 8 10 12 14 16 18 20 22 24 26 1 2 3 4 5 6 7 8 9 10 11 12 13 Russia JapanItaly India China Germany Poland Brazil France United Kingdom Turkey United States Spain Source: World Bank, Statistai 1 2 E-commerce comparison, 2015 Developing countries’ average 5,1% Developed countries’ average 7,1% CAGRofGDP(2006-2015),% Developed countries Developing countries Online retail / total retail, % § Governments of developing countries such as China, Russia and India are supporting e-commerce so these countries are rapidly closing or passing developed countries (China) 9 E Trade Penetration
  21. 21. The Future = Ecosystem
  22. 22. • Large scale game • Different dynamics than B2C • Need government involment for rapid growth • Very dependent on international and local political issues • Needs to be supported with an ecosystem What is different in B2B?
  23. 23. Source: TİM, TUİK, Istituto Nazionale di Statistica Number of Exporters, 2016 514 Bill $ 142.5 Bill $ Export Volume, 2016 (USD $) 2,13 Export/company Bill $ 2,6379,80 Population Million 60,80 195.000 67.000 Direct correlation between no of exporters and export volume No of Exporters vs Export Volume -%23 +%20
  24. 24. Logistics Delivered Tax Refund FX Negotiation Manufacturing and Stocking General Cross-Border Trade Flow
  25. 25. Money Cargo Core problems during trading process Trust Core Problems-All about Trust u Buyers are worried to make advanced payment but not receiving their goods; u Suppliers are worried that they would not be able to receive payment for the goods supplied; u Suppliers are worried about risks involved in soft clauses and issuing banks; u ……
  26. 26. Existing Solutions p Guarantee for advanced payment? p Insurance p Financial Protection & Management p Letter of Credit p CollectionBank Insurance Solution Bank Goods before Payment Simultaneous Transfer of Goods & Payment Payment before Goods
  27. 27. New Landscape for Cross Border Trade Internetization 2 Goods before Payment: Policy Loans 3 Letter of Credit: Paperless Form 4 Documents: Digitalization, Internalization Primarily based on TA, ECL to assist buyer’s issues to be settled in place within one step Based on Internet Insurance + Financial Method Solve Supplier’s Financial and Risk Issues Sale on Credit is no longer a barrier for Suppliers Via paperless letter of credit method Enable clients who cannot understand the letter of credit to also use it conveniently Receive financial support smoothly All cross border documents to attain digitalization SMEs to receive all insurances, financing and settlement services effortlessly through the Internet! 1 Payment before Goods: TA+ECL WORLD TRADE
  28. 28. Alibaba Group Ecosystem
  29. 29. International Trade: No Longer Just the Realm of Big Corporations Lack of confidence in doing international trade ► On- and offline partnerships (with tradeshow organizers, trade associations, government bodies, big buyers, etc.) ► Education materials, seminars, etc. Lack of foreign market knowledge / connections ► Active trading community ► Online market research tools ► User forums / knowledge sharing ► Robust global online company database Challenges Solutions Online marketplaces can enable small businesses to overcome a number of barriers to international trade Limited capital and resources ► 24 x 7 product showcase and global reach ► Highly efficient online marketing tools ► Low-cost communication tools
  30. 30. A Solution to Export Problems of SMEs One Touch Shenzhen OneTouch Business Service Ltd. (OneTouch in short), is a wholly owned subsidiary company of Alibaba Group, serving as the first and leading online platform providing professional import and export BPO (business process outsourcing) services to China’s small and medium- sized cross border trade enterprises. OneTouch has been the No.1 import and export BPO service platform in China by consolidating scattered service resources of different sorts for cross border trade and financing to provide professional services including customs clearance, logistics and financing services FY2016 $15+ Billion FY2015 $6+ Billion
  31. 31. The more suppliers use OneTouch, the more values we can provide for them. Because we can be more powerful to impact regulations. Customs Taxation Inspection Banks Logistics FX Onetouch SME One Touch Model Suppliers can focus on their core competence,such as finding orders and manufacturing. Business Model and Success factors Integrated BPO services make export and import more efficiently and with lower cost. All trade data of suppliers and buyers can generate more credit which brings more orders. Financing Clearance Taxation Logistics FX Administration Entry-exit Inspection
  32. 32. • World needs trained e commerce people • Ecosystem can not be complete without e commerce trained and minded people to become; • Entrepreneurs • E commerce professionals • This is a long term goal which needs time and resources • Both needs Universities and Private institutions • Key success factor for future of e commerce Key Ingredient : Trained Work Force
  33. 33. GET Project
  34. 34. GET Project

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