E-commerce - Cape Peninsula University of Technology
E-commerce - Cape Peninsula University of Technology E-commerce - Cape Peninsula University of Technology
Chapter 2: Literature review Page 19 According to Buderi (2005), their will be a massive growth in the electronic economy in the next decade. This will be as a result of: • Increased and extended usage of Internet shopping frorn existing e customers. • Continual development and evolution of Internet shopping as more companies decide to have a web presence. • A demographic drive caused by the maturation of an Intemet-sawy generation. • Greater accessibility to electronic shopping processes as they become more widely available in some markets. • The potential demise of physical stores and traditional retail outlets. This is a very real threat. 2.4 INTERNET TECHNOLOGY USE IN E-RETAIL ACTIVITIES IN DEVELOPED AND DEVELOPING COUNTRIES It is widely presumed that e-commerce is thriving around the globe. But where developing countries are concerned, as long as the business-to business (B2B) segment of the market does not take off, e-commerce volumes there will remain "negligible", warns the e-commerce and development report 2002, released by UNCTAD. The report says that the route to a prosperous B2B sector, and its attendant benefits for the economy at large as benefits drive through to the consumer (B2C), lies in joining regional and global supply chains. The prospects for that happening are good, especially given that the rapid growth in both e-commerce and Internet use is expected to continue. This applies particularly to the developing world, where penetration rates are lower. The UNCTAD report further states that Internet use soared 30% in 2001, with one third of all new users in the developing world. E-commerce is also increasing in these countries, although more slowly, and that is particularly true of B2B, which comprises 95% of all
Chapter 2: Literature review Page 20 e-commerce 2 (Bytheway, 1995). For the retailer all the B2B activity upstream in the supply chain makes for more reliable supply and lower administration costs. The question arises as to whether the final stage retailing to the consumer will follow through and "go digital" through increased B2C activity. The UNCTAD report concludes that the main impediment to the takeoff of e commerce in the third world is inadequate information and communications technology (ICT) infrastructure, as well as shortcomings in physical infrastructure, logistics and trade facilitation. 2.4.1 Internet technology use for retail activities in South Africa The mixed results in Asia, the US and Europe are generally far in advance of what has been achieved in Africa. The UNCTAD report explains that although Internet connectivity is slowly improving in Africa, e-commerce there remained limited at the time of the study. Local Internet connection is now available in all African capitals, and legal monopolies in Internet service provision have almost disappeared, resulting in a 30% rise in data traffic from the continent in 2001 alone. But the e-commerce infrastructure gap between developed and developing countries is largest in Africa, where only one in 118 people use the Internet - or only one in 440, when the five countries with the most users are excluded. According to a study of South Africa's Internet industry by independent technology research organisation World Wide Worx, the rollout of Internet access services by South Africa's telecommunications operator (Telcom) is 2 It is actually inevitable that the greater majority of e-
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Chapter 2: Literature review Page 19<br />
According to Buderi (2005), their will be a massive growth in the electronic<br />
economy in the next decade. This will be as a result <strong>of</strong>:<br />
• Increased and extended usage <strong>of</strong> Internet shopping frorn existing e<br />
customers.<br />
• Continual development and evolution <strong>of</strong> Internet shopping as more<br />
companies decide to have a web presence.<br />
• A demographic drive caused by the maturation <strong>of</strong> an Intemet-sawy<br />
generation.<br />
• Greater accessibility to electronic shopping processes as they become<br />
more widely available in some markets.<br />
• The potential demise <strong>of</strong> physical stores and traditional retail outlets.<br />
This is a very real threat.<br />
2.4 INTERNET TECHNOLOGY USE IN E-RETAIL ACTIVITIES IN<br />
DEVELOPED AND DEVELOPING COUNTRIES<br />
It is widely presumed that e-<strong>commerce</strong> is thriving around the globe. But<br />
where developing countries are concerned, as long as the business-to<br />
business (B2B) segment <strong>of</strong> the market does not take <strong>of</strong>f, e-<strong>commerce</strong><br />
volumes there will remain "negligible", warns the e-<strong>commerce</strong> and<br />
development report 2002, released by UNCTAD. The report says that the<br />
route to a prosperous B2B sector, and its attendant benefits for the economy<br />
at large as benefits drive through to the consumer (B2C), lies in joining<br />
regional and global supply chains. The prospects for that happening are<br />
good, especially given that the rapid growth in both e-<strong>commerce</strong> and Internet<br />
use is expected to continue. This applies particularly to the developing world,<br />
where penetration rates are lower. The UNCTAD report further states that<br />
Internet use soared 30% in 2001, with one third <strong>of</strong> all new users in the<br />
developing world. E-<strong>commerce</strong> is also increasing in these countries, although<br />
more slowly, and that is particularly true <strong>of</strong> B2B, which comprises 95% <strong>of</strong> all
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