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The Impacts Of E-commerce On Business

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Discuss about the Impacts of E-Commerce on Small Sized Business in Turkey.



Various small and medium sized enterprises in the developing countries have possibilities to gain benefits by the mobile technology, internet and other forms of information and communication technology for the business activities. In the developing countries, small and medium enterprises operate majority of the business in the manufacturing and services sectors. So, the government and private sectors need to take high level of advantage and opportunities in the ICT landscape. Along with this, governments need to make sure that the users of the internet is only connected with the online tools but also from the technological innovations to enhance the speed of data flow and reduce the cost of the customers (Jansen & Mullen, 2008). This report focuses on the impact of e-commerce on the small and medium enterprise in terms of their growth and success in the operating market. The report provides three arguments to support e-commerce affecting small-sized business positively. The report is basically focused on the statement of the research which is related to the improvement of e-commerce in the small and medium enterprises operating in Turkey. This is a developing country and the organizations are seeking for the business expansion in the global level (Voola, Casimir, Carlson & Agnihotri, 2012).

Thesis statement

For this report, the thesis statement is “Turkish government should financially support e-businesses to enter world market in order to increase GDP.''

The initiatives of government play an important role in the adoption of e-commerce. The government has ability to make positive contribution to the development of e-commerce. According to the research done by various researchers, come of the challenges related to e-commerce cannot be addressed without the support of the government of country. In the competitive environment of market, there is the close relationship between the systematic operation of the business and existence and power of small and medium enterprises within the system. Most of the Small and medium enterprises are contributing to the system and fulfilling various functions which are not done by the large enterprises. SMEs have important roles in the social life also. In the Turkish economy, SMEs play a crucial role due to their numbers and large share of workforce involved. The government of Turkey have also have carried out various programs to support these enterprises. Currently, SMEs have a fundamental role in terms macro-economic balance and employment by enhancing the shares in the global economy (Ho, Lu, Lee and Peng, 2011).

SME and E-commerce

In the era of globalization and technological changes, there are various opportunities for Small and medium enterprises. But at the same time, there can also be some risks and threats for the business. It is considered that due to the flexible nature, SMEs can meet the expectations of the customers more quickly and they have more advantages as compared to large enterprises by using e-commerce. Due to the strong competition and much pressure of software, various companies are seeking for new ways to enhance their market share by using e-commerce solutions. Large companies have important human and financial resources to implement e-commerce (Stokes, 2011).


Based on this discussion, the summarization of role of e-commerce in SMEs can be done as follows. Due to the systems of e-commerce, SMEs are able to enter in new markets and compete with other companies. Along with this, e-commerce provides effective communication between buyers and sellers along with improving the product and service quality. It also contributes positively to increase the work process of the business. By investing in e-commerce, SMEs can reach the markets which they can never attain. Successful implementation of e-commerce is a complicate and multivariate process which is related to economic and social elements as much as technological, technical, legal and physical infrastructure (Kant & Narwal, 2014).

According to Rainer and Cegielski (2011), e-commerce can be describes as the process of buying, selling, and exchanging and transferring the product, services or information by the computer network including internet. The strategy of e-commerce is to achieve various advantages in the business. The strategy goal of e-commerce enterprises is to develop new advantages, reduce the disadvantages and maintain the existing benefits. So, strategy is to provide better opportunities to the customers and deal with the competitors in the market (Molenaar, 2012). The advantage of e-commerce is as follows:

  • Low-cost advantage- Buying the products and services at the affordable prices,
  • Differentiation of advantage- providing products and services which are different and unique in terms of functions and features,
  • Focus advantage- Clearly meeting the requirements of the customers,
  • Advantage of order fulfillment- High level realization of trading operations, and
  • Management advantage- Capability to deal with the changes quicker as compared to other methods (Kraft & Kakar, 2009)

Role of government

In the developing countries like Turkey, there is the need for the new metric of e-commerce activities to inform the government legislation and policies. It is important to identify the current state of e-commerce in Turkey and understand the current challenges and limitations to enhance the adoption of e-commerce in the country. To address the problem of lack of resources, there should be new methodology from the government of Turkey. There are arguments which support that the government of Turkey should financially support the e-business to enhance the GDP of the country. While adopting e-commerce in the country, there are some factors affecting this process. In Turkey, there are some important factors which impact on the e-commerce adoption. To explore the important of e-commerce and opportunity of its growth in Turkey, it is important to understand various national factors that affect e-commerce adoption. Various factors have been identified which are depicted in the figure. The figure describes the impact of each factor on other factors. All these factors will be used in developing the research model of e-commerce adoption by Turkish government (Feigenbaum, Parkes & Pennock, 2009).

Figure 1: Factors affecting E-commerce

From the above figure, it can be said that government initiatives are important for the adoption of e-commerce in general. They can be in terms of the promotion of ICT usage, education and the establishment of proper regulatory framework for e-commerce including tariff and taxation for generating revenue by the e-commerce. Along with this, the initiatives of government can also be affected by various factors including political conditions, economic conditions, and external impact from other countries. This report provides some arguments which support that the government of Turkey should financially support e-commerce for entering in the market to enhance GDP rate (Tassabehji, 2003).

 E-commerce is the key for growth for the small businesses

With the minimal capital outlay, the small and medium sized companies can easily expand the business in the national and international market and locate more customers’ business partners and suppliers. It means, with the help of e-commerce, companies can get more opportunities in the international market and can enhance the sales in order to enhance the revenue (Chang & Wu, 2011). There is the growing realization that selling the top quality product at the best price is not only a fraction of organization but also it is effective for the supply chain. So, the process of business improvements depends upon the expansion beyond organizational boundaries. Electronic commerce is now used by various companies of different scales such as business suppliers, customers, banks and public institutions, customs offices, and provides savings in terms of time and costs. Because of electronic commerce, companies are able to check inventory status and reduce the inventory costs by supply-demand balance (Baig, Raza & Farooq, 2011).


Because of the broad market and range of shopping opportunities provided by e-commerce, organizations are able to perform advertising and marketing of the products and services in all over the world. E-commerce is providing opportunities to the companies to open the business in the new market without taking any taking any risk by establishing physical offices and shops. By the e-commerce, products are delivered directly to the potential customers by the online tools. For the Small and Medium Enterprises in Turkey, it is important to expand the business at the international market. It is observed that customers are active on the online and social media tools in the developed countries and they have ability to judge the products and services by the online tools. In such case, Small and Medium Enterprises need to have their presence on the e-commerce so that more and more customers can be attracted in the international market (Strauss & Frost, 2014).

There is the drastic change in the ways of businesses and trades due to electronic commerce. Every day, more users in the least-developed and developing countries are accessing the internet by terminals. It is assumed that internet and use of mobile applications will expand exponentially in the upcoming years. There is lots of potential for using e-commerce to contribute to the social and economic progress of developing companies like Turkey in all over the world. According to recent information of UNCTAD’s economy report, e-commerce is used by micro and small sized enterprises in order to improve the performance of the business. Various companies in the developing countries like Turkey have possibilities to benefit from e-commerce in the business activities (De Mooij, 2010).


Figure 2: Individuals using internet

By improving communication channels and e-commerce at the domestic and international level, the application of relevant e-commerce can improve the competitiveness of the business (Palmer, 2011). The efforts of government to enhance, upgrade and expand the e-commerce used by private sector should be supported. The study of UNCTAD reveals that government and their various partners are taking full advantage from the e-commerce.

E-commerce contributes to economic growth

E-commerce is gaining larger impact over the development and growth of the countries. The introduction of e-commerce creates a tremendous contribution to growth of various countries. Some researchers expect that the contribution of e-commerce will grow faster as compared to the contribution from traditional sales. The e-commerce represented more than 80% of the worldwide and has significant impact on the large economic sectors of the country such as finance, communications, and retail. In Turkey, the idea of e-commerce is used in the business sectors and now, various government and private sectors are also focusing on the system of e-commerce (Sen, Bandyopadhyay, Hess and Jaisingh, 2008). The major support of the electronic commerce went to promotion of e-commerce for the small and medium companies. With the increased level of e-commerce, technology will grow for the small and medium enterprises of Turkey. Along with this, IT sector will also grow which will enhance the national income of the country. The technology trend eliminates the border of between online and offline and enhance the experience of the customers and their knowledge in various areas. Turkey is important player in the world including 46 million internet users and 58% internet penetration (Xiaoming, 2010).


E-commerce as a mean of resource expansion

The system of the e-commerce is focused on reducing the barriers of entry for the companies in the new market. Along with this, e-commerce is also helpful increasing the use of internet by the development of the organization and provides the experimentation with the new forms of the resource expansion. The e-commerce could allow the companies to tap into the world market place and effectively generate the revenue to equalize the operating costs. The key strategy of e-commerce is to sell products and services online to generate revenue to balance the operating cost of the business (Rowley, 2001). The companies are approaching e-commerce as the mean of covering not only the costs of producing products and services and distributing the development focused products. Along with this, companies also seek to expand its revenue base to support other project costs and then they may want to develop the e-commerce strategy and platform so that more and more customers can be attracted by the company. Further, the companies may have to approach e-commerce as the resource expansion activity that can be used as the business strategies and marketing approach (Bernard & Simone, 2011). Good marketing strategy is also included in the e-commerce for the business operations. E-commerce basically creates online market for the customers to purchase the products and services. The online platforms can be as the tool in order to capture the online market so; the electronic media is very effective for the Turkish small and medium companies. Along with this, the electronic techniques also include identifying other sites that that are beneficial for the cross selling of the products. These sites include online partners and other sites that provide links to develop online resources for the companies. Further, this technique also includes identifying the target market who would be interested in purchasing the specific products in the global market. Companies can also use e-mail to be connected with the customers. In this way, developing countries will be able to expand the business in all over the world (Occena & Yoon, 2015).



This report basically focuses on improvement of e-commerce and mobile technology as it is well known that these systems have transformed the lives of many people in the developing countries. Report supports the thesis statement that government of Turkey should support e-commerce to enhance GDP rate of the country and support SMEs to enter in the world market. Along with this, three arguments are also provided to support positive impact of e-commerce on the business and country. From the above discussion, it is observed that e-commerce provides effective communication between buyers and sellers along with improving the product and service quality. E-commerce also contributes positively to increase the work process of the business. Along with this, it is also analyzed that E-commerce is providing opportunities to the companies to open the business in the new market without taking any taking any risk by establishing physical offices and shops. E-commerce basically creates online market for the customers to purchase the products and services. The online platforms can be as the tool in order to capture the online market. So, government of Turkey should focus on the various e-commerce sites and tools and try to provide them to the organizations along with supporting in financial terms.



Baig, M. K., Raza, H., & Farooq, U., (2011), E-Commerce Adoption: A Comparative Study of Sweden and Pakistan, Linköping

Bernard, J. and Simone, S., (2011), Bidding on the buying funnel for sponsored search and keyword advertising: Journal of Electronic Commerce Research, 12(1). pp. 1-18

Chang, H.-T. and S. Wu, S., (2011), A Switching Proxy for Web Search Engines. Advanced in Information Sciences and Service Sciences: Advanced Institute of Convergence Information Technology, 3(5), pp. 52

De Mooij, M., (2010), Consumer behavior and culture: Consequences for global marketing and advertising, Sage Publications, Incorporated

Feigenbaum, J., Parkes, D. C., & Pennock, D. M., (2009), Computational challenges in e-commerce: Communications of the ACM, 52(1), 70-74.

Ho, L.H., Lu, M.H.,  Lee, C.P.  and Peng, T.F., (2011), Exploration of Search Engine Optimization Technology Applied in, Internet Marketing: Advances in Information Sciences and Service Sciences, 3(7)

Kant, R., & Narwal, M., (2014), ROLE OF E-COMMERCE IN CONSUMER DECISION MAKING : International Journal of Research in Business Management, 2(6), 77-88

Kraft, T. A., & Kakar, R., (2009), E-commerce security: Paper presented at the Proceedings of the Conference on Information Systems Applied Research, Washington DC, USA
Jansen B. J., and  Mullen, T., (2008), Sponsored search: An overview of the concept, history, and technology: International Journal of Electronic Business, 6(2), pp. 114-131

Molenaar, C., (2012), E-marketing: applications of information in technology and the internet within marketing, Abingdon: Routledge

Occena, G. L., & Yoon, H. S., (2015), Influencing factors of trust in consumer-to-consumer electronic commerce with gender and age: International Journal of Information Management

Palmer, A., (2011), Principles of services marketing, (6th), Berkshire: McGraw-Hill

Rowley, J., (2001), Remodeling marketing communications in an Internet environment”, Internet Research: Electronic Networking: Applications and Policy, 11(3), pp. 203-212

Sen, R.,  Bandyopadhyay,S.,  Hess, J. D. and Jaisingh, J., (2008), Pricing paid placements on search engine: Journal of Electronic Commerce Research, 9(1),  pp. 33-50

Stokes, R., (2011), E-marketing: the essential guide to digital marketing, (4th), CapeTown: Quirk Education

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Tassabehji, R., (2003), Applying E-commerce in Business, Sage Publications Limited

Voola, R., Casimir, G., Carlson, J. and Agnihotri, M. A., (2012), the effects of market orientation, technological opportunism, and e-business adoption on performance: A moderated mediation analysis: Australasian Marketing Journal, 20(2): 136-146

Xiaoming, M., (2010), Study on Combining of E-commerce and E-marketing: Journal of Software, 5(5): 546-553


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