E-commerce looks set to sweep New Zealand business off its feet, according to the latest Computerworld 1000 Survey.
Only five of the 30 respondents from among New Zealand’s top companies claimed they were not using or planning to use an e-commerce Web site.
Of the rest, eight would use their sites to “promote business”, nine would hope to “handle transactions” and another nine would do both.
That’s good news for Web developers, because despite all this interest in e-commerce sites, only four respondents would expect to take on more staff on a permanent basis.
“Business to business is growing very well at the moment. It’s an excellent way of using the Web,” says Web designer Dave Blyth. He’s seen such a demand for his services that he’s now in the enviable position of being able to choose his customers.
“We don’t want to get bigger, we want to get better,” he says.
Blyth believes many companies are reviewing their systems and moving to a more customer-centric approach. “Why have all this paperwork and faxes going backward and forward when we can put all this stuff online? It’s simpler for everyone.”
Not everyone, however, is that technologically advanced. “Most of our customers don’t even have PCs, they’re still using terminals,” says Alan Storey, IT manager with Trade Tools, a manufacturer of cutting tools. He believes advanced Web development has to be driven by customer need.
“It wouldn’t cost too much for our bigger customers to get a PC and be able to access our stuff over the Web, but it’s not happening yet.”
Trade Tools does have a Web site, (www.tradetools.co.nz), but Storey says it’s not a priority at the moment.
We asked respondents if their IT departments had the skills to develop an e-commerce platform and received a mixed bag of answers.
Fifteen respondents said their IT staff did have the skills, 10 said they did not and two felt they would need to outsource the work but keep the management of any project in house.
One respondent, however, pointed out that development wasn’t a job for the IT department alone, but rather fell under the domain of the marketing department. Blyth agrees.
“A lot of companies say: ‘Internet, that’s one for the IT department’. Often those people have zero graphic skills and zero marketing skills.”
There are pitfalls with getting the marketing department to develop a Web site, however. “There aren’t many people who understand the Internet unless they’ve been on it a long time.”
Blyth does have a warning for those companies that simply dabble in Web dev-elopment and e-commerce. “In a recent US survey, three companies had sites that were considered good, while the other 97 had sites that annoyed customers.” Blyth says many Web sites haven’t undergone the scrutiny they should have received, and consequently don’t live up to a company’s expectations.
One respondent, working for a hire purchase company, claims to be using
e-commerce from the other side of the equation. While the end customer still has to deal with the reseller in a traditional manner, the reseller deals with the hire purchase company in an entirely electronic manner.
“All our business is electronic — it’s just not done over the Net.” All invoicing and documentation is recorded electronically, and all customer details are captured at the point of sale.
“If all goes well, 95% of our contracts aren’t touched and we get all our payments through the money transfer system.”
In the future, the respondent hopes to move to an Internet version of the current system, but he points out that it’s not so easy for companies that have no history of e-commerce. “It requires a fundamental change to the business model. There’s no point in simply tacking on an electronic solution to the same old back office way of doing things.”
The next big move for this respondent would be to cut out the middle man and deal directly with the customer base, and e-commerce would be the ideal way to do that.
“Margins aren’t particularly large and we do a large number of low-value, high-volume lending transactions each year. E-commerce would allow us to keep our profit levels up.”