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SINGAPORE: A survey by money transfer e-commerce company PayPal showed on Thursday that two-thirds of e-commerce sites by small and medium-sized enterprises (SMEs) were launched in the last two years.
In the next 12 months, a further 36 per cent of firms were expected to follow suit. The survey polled about 1,500 SMEs from India, Malaysia, Singapore and Thailand.
PayPal said this shows a growing trend of companies using the online space to expand their customer base and benefit from low overheads and costs.
Online watch retailer Gnomon Watches was set up about seven years ago. It is just one of many start-ups that thought that the online space represented good growth potential.
Indeed, for Gnomon Watches, its business has grown 20 per cent annually since its inception. The watch retailer also receives some 80 per cent of its business from online sales.
The firm said in the past few years, the attitude towards selling quality items online has shifted.
Anders Tan, director of Gnomon Watches, said: "A lot of watch brands, watch companies are all going online. If you look at it five years back, they were not into this online thing, it's like a taboo. If you start selling their watches online, they are not too supportive of the idea.
"But now, a lot of watch companies are going online, doing a lot of online marketing and online sales because customers are very Internet savvy. I think the online model is the first step to getting new customers and old customers to buy again."
PayPal said for smaller companies, going online is becoming a common business strategy to boost global customer base. In fact, some 88 per cent of companies surveyed used e-commerce sites for online orders.
Mario Shilashki, managing director & general manager, SE Asia & India, PayPal, said: "90 per cent or so look to e-commerce to grow, but only a third of their turnover is actually coming from e-commerce. So I think there is a significant opportunity for SMEs in Singapore to take their websites and make them transactional... e-commerce for Singapore is potentially a huge avenue for growth, compared to the rest of the region."
However, for many SMEs in Asia, a lack of capability and appropriate sources of information to launch a cyber arm remain as a key challenge.
- CNA/so
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