Application of e-logistics for SMES in China

Abstract

By the rapid development of electronic commerce, many problems are emerging in logistics systems within developing countries. For developing countries such as China, India, and other southeastern countries Logistics is becoming a major part of GDP and logistics cost constitute a large portion of supply chain costs especially for businesses with international relations which is being more and more widespread in parallel with development of IT and e-commerce. Such an interactive juxtaposition of logistics and e-commerce motivated us to look at how small and medium sized enterprises (SMEs) are run, and of course through a lens that sees these two concepts together. Another point that spiced our motivation was the bloom of virtual businesses especially those with one head in developing countries and the other in developed countries. According to The CIA 2006 fact book, there are 137 million internet users in China. As e-commerce and its logistics support systems in China have a huge effect in the global trade, we have targeted our thesis case towards China. We have narrowed down our case to Chinese SMEs, which are small and medium sized Enterprises located in china; as SMEs, which their number has reached to 42 million, are now responsible for more than 90% of China's industrial output [1]. How the Chinese Electronic business should manage the way logistics must be integrated with e-commerce is the study which the thesis concerned about. In this research we are going to argue the barriers to ecommerce adoption in China, logistics-based barriers to successful SME establishments in china and also put up some suggestions upon possible strategies that can facilitate this process. We have concluded the thesis with two models, one for e-commerce adoption inside SMEs and the other one for Business to Business (B2B) and Business to Customer (B2C) e-commerce development. We didn‟t make any effort for developing a strategy for logistics leg of e-logistics due to the limited size of research and time barriers. The property that differentiates this study from previous similar studies is that here we face business environment in a different way and consider culture and government as two most important features of Chinese business environment.

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