E-commerce is by far the easiest way to get into exporting. If you have something to sell, you can get started with a connected lap-top on your kitchen table. It’s that simple.
ScotlandIS, the trade body for Scotland’s businesses in software, IT and creative technology, knows that many businesses have started this way and are now working with Scottish Enterprise to raise the flag for e-commerce exporting.
Polly Purvis, director of ScotlandIS, says that e-commerce is an easy way to get going – however the technology platforms are changing so rapidly it is often hard to keep up with the emerging trends.
“We’ve set this partnership up with Scottish Enterprise and Smart Exporter around the opportunities that e-commerce provides for Scottish businesses. Clearly, the drive from SE’s point of view is to expand exports from Scottish businesses. E-commerce is one of the easiest ways for people to start exporting. Once you are up on the web, your customers can see you from around the world.”
Companies that start to build e-commerce platforms for transactions are among those experiencing the highest growth in sales outside their local geography.
“This might start off with customers in the UK but it quickly becomes other parts of the world.”
This is the catalyst for ScotlandIS’ e-commerce programme, which is endeavouring to increase export sales from all sectors of the economy.
“We are not involved with any specific interventions on a company-by-company basis. We are trying to get the message out that we are open for business across all sectors,” she says.
“An early win has been with Scotland’s food and drink industry and the statistics suggest it is doing well on its export drive. However, we want to assure companies from all other sectors that they too can get involved,” says Polly Purvis.
The programme involves a number of industry briefings and a series of more in-depth master-classes aimed at helping companies fine tune their e-commerce capabilities.
“The industry briefings have been on a taster basis up until now. Hopefully, with Scottish Enterprise’s support we will be running them over the next 18 months. The master-classes will run until early 2015.”
“E-commerce is a very fast moving market place. Everything is changing not necessarily day-to-day but certainly month-to-month. Keeping up-to-date about the wider market place and the trends is a challenge for smaller companies using e-commerce as a platform,” says Polly Purvis.
Smaller companies now have a great deal to keep in mind. It is about making sure the website is right with great content, that the search engine optimisation and social media, such as Twitter and Google Plus, are being properly exploited, and vital analytics tracked.
It is about making sure the fulfilment is in place, working with distribution partners, such as DHL. This is all part of a modern e-commerce company who has ambition to export.
“We recognise that all of this is hard to keep up with if you are a small team with only one, two or three people. It is difficult, so we are building up a team of specialist practitioners across Scotland who are involved with this.
We want to give companies an easy way to always be at the leading edge.”
ScotlandIS is working to help businesses plot the next stages in their e-commerce journey, helping build great capabilities and looking into new overseas market. A first step is finding the right e-commerce platform and this should have the ability to add functionality as the company expands.
“Our master-classes are extremely valuable because they are helping people share experience on this. It’s about knowledge and information to build capability in-house. Companies need to appreciate they don’t need to take a huge bite when building their e-commerce platforms. They can simply get up and running with small bites and then add new chunks as they grow. Certainly an e-commerce event will be a must for next year.
“We are all used to Amazon and Google being some of the big players but when you go to other parts of the world then there are different players involved and lots of smaller companies. For example, selling on eBay doesn’t work if you are selling into China and some other parts of the world.”
ScotlandIS is also running a conference and award ceremony on 13 February 2014 to highlight and celebrate the best of breed in the e-commerce sphere. This will include the latest development on e-commerce and who is leading the pack, particularly internationally.
Sense and sensor-ability
The capability of our information and communication technologies has a strong bearing on how Scotland performs in the big global markets.
“The knowhow of those who are developing the IT solutions and the platform capabilities is going to help us seize markets,” says David Smith. He pinpoints two areas: sensors and digital imaging as key for expansion. The sensor is a smart device that connects the digital world to the real world. They are the interfaces that enable the real world to operate more effectively in our increasingly digital world. “Scotland is already strong in this space. Using 2010 figures, it is worth £2.4bn in terms of the collective companies.
There is a pretty strong cluster of 150 firms, with major companies including Selex, based in Crewe Toll, in Edinburgh, and emerging firms such as Gas Sensing Solutions and Coherent, based in Glasgow. All of which are doing well. The growth rate of that market is exciting and we predict about 9% annual growth rates for the sensor market.”
Senors are also vital for subsea activity in the oil and gas industry – where humans cannot operate and measuring flow and pressure is vital - and there higher growth rates of around 40% are predicted. So Scottish Enterprise is focusing on this prize too.
“We have an action plan around this opportunity, working with other public sector partners and the private sector. It includes targeting some of the really big markets such as Japan, where a big chunk of the sensors manufacturing market already exists. Health care is another area that is growing and creates interest for Scottish Enterprise.
“There are a great number of sensors in that market. We are working with medics within a small company with applications in the wound area, about giving patients the ability to do their own testing of the level of moisture in the wound. And all the savings that go with the tele-health care enabling people to monitor in their own homes. This will enable considerable savings in health care,” he says. Scottish Enterprise is also aligned with the new Technology and Innovations Centre at Strathclyde University in Glasgow, where there will be a focus on sensors and imaging.
The technology advisory group (TAG), a high-level group of business people from the technology and engineering, is also advising on theses action plans. Funding for companies is now well developed too and there are several mechanisms. Scottish Enterprise is trying to identify companies that can grow to £5m within five years. The Scottish Investment Bank operates as a funder through the Scottish Co-Investment Fund, which can match fund up to £2m with Scotland’s vibrant angel investment network.
The bank operates by getting alongside the private investors in the normal way and supporting their judgment and diligence. In the sphere of commercialisation function, David Smith’s colleague Eleanor Mitchell and her team of specialists are working closely with academia, and other parts of the private sector looking for opportunities that may emerge as a result of spin-outs from universities. While e-commerce is the starting point for many exporting businesses, it is not the complete answer and firms really have to understand their evolving relationship with customers.
“We see that ICT is enhancing the relationship with customers and this is why Scottish Enterprise supported 500 companies last year, a large part of this in sales and marketing strategy,” he says.
“My job is to provide the overall strategic direction and where we see the major opportunities and what direction Scottish Enterprise should give to the various support functions and mechanisms. It’s an unfinished task because technology is always moving – and that’s the way it should be.”