SME retailers lack resources to set up business online: ARA

Small to medium enterprise (SME) retailers are keen to use the National Broadband Network (NBN) for e-commerce but lack the necessary skills or resources to get online, according to Australian Retailers Association (ARA) policy director, Heath Michael.

Michael told an NBN selected committee in Sydney that while its 5500 members, many of whom are SMEs, see online as an advantage rather than a threat, some did not know how to set up a website.

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“Many of those regional retailers want to reach the global market through the NBN but they lack the knowledge on how to do that,” he said.

“We are working with companies such as eBay to encourage retailers to use their e-commerce platform.”

In addition, the ARA has a pilot project underway with the Victorian state government to help get SMEs in regional Victoria online.

In New South Wales, the state government has also approached the ARA to assist with online education programs starting in the state’s regional areas.

According to Michael, part of the issue is that the Australian retail industry lacked leadership from large retailers when it came to embracing e-commerce.

“The Australian retail sector had a long period of growth up until three years ago when online competition increased and the big retailers have taken some time to sort themselves out,” he said.

Michael was asked by the committee what was stopping SMEs from getting online.

“A major factor would be the cost to run a website because the quotes to set one up vary. Some of those go to market solutions [that] are very expensive when they don’t need to be,” he said.

Another barrier was that margins were tight for many SME retailers and they could not afford to hire a Web developer.

In addition, online purchases under $1000 do not attract a Goods and Services Tax (GST) which has drawn the ire of Australian retailers such as Harvey Norman co-founder, Jerry Harvey.

“We are working with the Federal Government taskforce on this issue because we want to see a $1 threshold [for online purchases] so there is a level playing field across the industry,” Michael said.

Follow Hamish Barwick on Twitter: @HamishBarwick

Follow Computerworld Australia on Twitter: @ComputerworldAU

Copyright © 2012 IDG Communications, Inc.

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