Individual essay pham lam ngoc AEn T321WSB 6 21000375

SCHOOL OF BUSINESS

ASSIGNMENT COVER SHEET
STUDENT DETAILS
Student
name:
Pham Lam Ngoc

Student ID
number:

UNIT AND TUTORIAL DETAILS
Unit
name:
Academic English
Tutorial group:
Lecturer or Tutor
name:

21000375

Unit
number:
Tutorial day and
time:

AEn-T321WSB-6

Mon-Tue-Thu / 8am –
11.30am

Mr. Gabriel Ryan

ASSIGNMENT DETAILS
Title:
Individual Essay
Length
Due
:
1283 words
date:
Home campus (where you are
enrolled):

02/01/2022

Date
submitted:

02/01/2022

DECLARATION









I hold a copy of this assignment if the original is lost or damaged.
I hereby certify that no part of this assignment or product has been copied
from any other student’s work or from any other source except where due
acknowledgement is made in the assignment.
I hereby certify that no part of this assignment or product has been
submitted by me in another (previous or current) assessment, except
where appropriately referenced, and with prior permission from the
Lecturer / Tutor / Unit Coordinator for this unit.
No part of the assignment/product has been written/produced for me by
any other person except where collaboration has been authorised by the
Lecturer / Tutor /Unit Coordinator concerned.
I am aware that this work will be reproduced and submitted to plagiarism
detection software programs for the purpose of detecting possible plagiarism
(which may retain a copy on its database for future plagiarism
checking).


2
2
Student’s
signature:

Lam Ngoc

Note: An examiner or lecturer / tutor has the right to not mark this assignment
if the above declaration has not been signed.
ARO 00380 08/15

The Strategy For SMEs To Adapt To E-commerce

Pham Lam Ngoc
Western Sydney University
AEn-T321WSB-6
Mr. Gabriel Ryan
February 2, 2022


3
3
In today’s modern world, Electronic commerce (e-commerce), which is regarded as
a global strategy and has been responsible for multiple changes to many organizations and
customers over the last century, has risen dramatically due to the massive expansion. Because
of the benefits of e-commerce, several large companies chose to investigate this potential
market as a step forward. However, Govindaraju et al. (2015) stated that in comparison to
larger enterprises, Small and Medium Enterprises (SMEs) are lagging behind in terms of ecommerce penetration. It is undeniable that SMEs have to face several impediments when
adapting to e-commerce regarding competition from large companies, cyber security issues,
financial barriers, and customers’ poor service. This essay will point out those common
difficulties and analyze several strategies to improve this situation.

One of the obstacles that SMEs have to face is competition from large companies
that have already existed on e-commerce platforms. It is a fact that large companies are real
barriers for SMEs since those large companies have engaged in the e-commerce domain for
an extended period. In other words, large companies have a thorough insight into the ecommerce market, strong brand images, and customers’ loyalty. Therefore, SMEs would
challenge finding market share and customers’ attention. Nevertheless, there are several
methods for SMEs to eliminate the competitive issues in e-commerce. Firstly, SMEs are
recommended a “Blue Ocean Strategy”. This method would help those companies create a
unique place in the e-commerce market and get over bloody competition. According to Kim
and Mauborgne (2015, pp. 3-5), the “Blue Ocean Strategy” refers to a market for a product
where there is little or even no competition. By accomplishing this strategy, SMEs can
reinvent their marketplace and create profit in entirely new ways. For example, in the 80s, the

4
4
cosmetics industry focused mainly on women and left men behind. Then, Romano was a
pioneer who produced perfume and personal care products for contemporary men, including
Eau De Toilette, hair care, and body care, officially marking the opening of formally
launching and expanding the market for men's beauty products. Secondly, SMEs should focus
on a specific product for the e-commerce market instead of investigating numerous products
that do not suit the company’s strengths. Mittal et al. (2018) demonstrated that although the
research and development of SMEs are not advanced, focusing on specialized products can
differentiate SMEs from their competitors. Finally, small and medium enterprises should take
action fastly. In other words, those companies should give discounts to keep the customers’
loyalty. Besides, analyzing purchasers’ feedback and ameliorating the quality of the product
in order to fulfill the demand of customers.

As e-commerce becomes more popular, security issues in these systems may become
a challenge to handle. Hille et al. (2015) cited that the growing scope and frequency of online
activity, as well as the growing number of consumer-specific data points, raises the risk of
this information being exploited. It is noticeable that business places a greater emphasis on
sales performance and less focus on maintaining security. Raghavan et al. (2017) claimed that
50% of small businesses have suffered from cyber-attacks. SMEs may indeed be more
attractive to hackers because they do not take the time to develop a contingency plan or a
response plan against cyber-attacks and do not have the resources to recover from an incident
when it happens. As a result, customers would not want to make purchases on SMEs’
websites because of the fear of losing personal information and financial data. Furthermore,
customers are not the only ones harmed by cyber assaults; the company suffers as well.


5

5
Therefore, SMEs had better maintain their cyber security in order to protect their companies
and get customers’ trust. Firstly, those companies are well-advised to secure the payment
gateway, which means not storing customer credit card information on the database. Also,
those enterprises could consider using third-party software regarding Paypal, Momo, and
Stripe to process payments off-site. Secondly, SMEs should deploy firewalls since efficient
firewalls would protect their website against XSS (cross-site scripting), SQL (Structured
Query Language) injection, and other cyber-attacks. Last but not least, using SSL certificates
and HTTPS is an excellent action to protect the website. SSL (Secure Sockets Layer) is a
security technology commonly used to secure server to browser transactions. HTTPS
(Hypertext Transfer Protocol Secure) is a protocol tool used to send data between a web
browser and a website, which probably increases data transfer security.

Another difficulty that SMEs may face when entering the e-commerce markets is
financial barriers. To proceed with the e-commerce market, SMEs need an enormous amount
of money for advertising, packaging, technological management systems, and training
employees on using online operational systems. Sallem et al. (2017) stated that SME's not
only have limited resources in technology but also in financing their resources in technology,
as well as in funding of their operations, promoting their products, and having an inadequate
budget for training their employees. As a result, a lack of financial resources could probably
limit the companies from improving their products and coping with the significant changes in
the e-commerce markets. Nevertheless, there are several methods for those companies to
overcome these barriers. Initially, SMEs can sell their product on E-commerce exchanges
such as Shopee, Lazada, and Tiki instead of creating their own websites, which may cost lots


6
6
of money. Moreover, those companies can call for investment from angel investors or capital
investors. In addition, if the products of those SMEs have a unique selling point, they could

participate in incubators or business shows such as Shark Tank to advertise their commodities
and get the financial resources.

Simultaneously, customers’ poor experiences with e-commerce services could also
be a reason for losing customers of SMEs. In terms of offline shopping, customers have a
tendency to visit a nearby store, and if they have a terrible experience here, they might still
visit those offline stores because of location benefits. However, online shopping can be
worldwide, and changes can be made easily. As a result, if customers have bad experiences
such as site loads slowly, they can switch to another e-shop that sells the same products
immediately. Therefore, SMEs had better have an attractive and effective service on ecommerce platforms to receive customer loyalty. To begin with, those SMEs should make
sure their websites have site loads quickly, optimize for mobile, simplify the checkout
process, and offer multiple payment options. Secondly, the website’s pages are recommended
to have brand stories and updated information, including promotion and new products, since
the websites would be an effective tool to retain existing customers and attract new ones.
According to Nisar and Prabhakar (2017), existing customers can visit the sites for news,
specials, and other updates, while new customers can simply access the companies’ sites and
learn about the brands at any time. Thirdly, SMEs should provide their customers with
several shipping options available in both speed and cost so they can choose the ones that
work best for them. Also, providing the information of the shipped package for customers to
keep track of would help maintain their trust. Consequently, those methods are a good way to


7
7
give customers a reason not only to buy products from the company over similar offerings
but also to be satisfied with the products, brand, and experience that they both re-purchase
and convince others to do the same.

In conclusion, regarding practical applications in the realm of e-commerce, it seems
challenging for SMEs to immediately transform and adapt because of the tough competition

with big companies, the management of security issues in technological systems, the lack of
financial resources, and the customers’ poor experiences. Therefore, those strategies are a
precondition that those SMEs must accomplish for their firm to succeed in today's ecommerce markets.


8
8
Reference List
Govindaraju, R., Wiratmadja, I. I., & Rivana, R. (2015). Analysis of drivers for e-commerce adoption
by SMEs in Indonesia (pp. 391–395). CRC Press.
Hille, P., Walsh, G., & Cleveland, M. (2015). Consumer Fear of Online Identity Theft: Scale
Development and Validation. Journal of Interactive Marketing, 30, 1–19.
/>Mittal, S., Khan, M. A., Romero, D., & Wuest, T. (2018). A critical review of smart manufacturing &
Industry 4.0 maturity models: Implications for small and medium-sized enterprises (SMEs).
Journal of Manufacturing Systems, 49, 194–214. />Nisar, T. M., & Prabhakar, G. (2017). What factors determine e-satisfaction and consumer spending
in e-commerce retailing?. Journal of Retailing and Consumer Services, 39, 135–144.
/>Raghavan, K., Desai, M. S., & Rajkumar, P. V. (2017). Managing Cybersecurity and e-Commerce
Risks in Small Businesses. Journal of Management Science and Business Intelligence, 2(1),
9–15. 10.5281/zenodo.581691
Sallem, N. R. M., Nasir, N. E. M., & Kassim, C. K. H. C. K. (2017). Small and Medium Enterprises:
Critical Problems and Possible Solutions. International Business Management, 11(1), 47–52.
10.3923/ibm.2017.47.52
Kim, W. C. & Mauborgne, R. (2015). Blue ocean strategy : How to create uncontested market space
and make the competition irrelevant (Revised ed., pp. 3–5). Harvard Bus Review Press.
(Original work published 2005)


9
9