The B2B eMarketplace: Empowering your SME Members

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The B2B eMarketplaceEmpowering your SME Members

• 6th World Chambers Congress
• Kuala Lumpur, Malaysia
• June 2009

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All About SMEs!
SMEs are the engines of growth around the world

• Big SME market
• In China 42 million SMEs
• In Europe 23 million SMEs
• In US 22 million SMEs
• Critical to global economy and trade
• In China 58 of GDP, 68 of import and export
  volume, 75 of employment
• In Europe over 50 of GDP, 60 of employment,
  over 100 million jobs
• In US over 50 of GDP, 67 of export volume, 67
  of employment

SME means all employer firms, self-employment
nonincorporated and incorporated.
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The Importance of SMEs in Developing Countries

• Contributing in many ways to the economy
• Engine for job creation
• Positive role in poverty alleviation
• Cover almost all (productive) sectors
• Are a main source for new products
• Diversify the economy and introduce flexibility

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Enterprises in Developing Countries in Ecommerce
eCommerce remains limited in developing
countries. Source UNCTAD Information Economy
Report 2007-2008
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How  online  are European SMEs?
And while a majority of European SMEs are
connected, and most even have their own websites.
. .

• Business use of the Internet and websites, as a
  percentage of businesses with 10 or more
  employees
• Source OECD Science, Technology and Industry
  Scoreboard 2007
• http//dx.doi.org/10.1787/118144527771

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European Enterprises in e-Commerce
. . . most are still not fully utilizing the
power of the internet to promote themselves and
products
In the EU, on average, only 15 of enterprises
receive the order online, and 23 purchase
online. Source UNCTAD Information Economy
Report 2007-2008
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Crisis or Opportunity?
With the recent downturn an Alibaba survey shows
that this recession will serve as a catalyst for
economic revival. . .

• 75 of Americans surveyed believe new
  entreprenuers and SMEs will be the key to
  economic revival
• 4 out of 5 considered starting their own business
• 44 who considered starting their own business
  said not understanding where to find the right
  suppliers was the top reason for not moving
  forward

. . .and those who embrace disruptive technology,
will survive and thrive while those who do not
will die
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Traditional Sourcing Work Flow
With the internet, B2B sourcing and selling is
much easier
Average sourcing cycle 3.3 4.2 months
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Source The Aberdeen Group
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A new gateway to global trade
14/11/2009 1916
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The advent of eMarketplaces has helped to address
many of these issues
Challenges
Solutions
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Alibaba.com B2B
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Alibaba.com B2B Marketplaces Anatomy of the
Marketplace
Suppliers
Buyers

• International Marketplace
• Facilitates global trade between China and
  international suppliers and buyers
• 8 mm registered users as of Dec 31, 2008
• 59,000 paying customers as of Dec 31, 2008

International SMEs
International Buyers
China Buyers
China SMEs

• China Marketplace
• Facilitates domestic trade between China
  suppliers and buyers
• 30 mm registered users as of Dec 31, 2008
• 372,000 paying customers as of Dec 31, 2008

Community Marketplace platform
Services / Products to suppliers
Services / Products to buyers

• Keywords premium placement
• Third-party authentication verification
• Trust profiles
• Tools to manage CRM and trade info

• Search
• Directory
• Inquiry RFI/RFQ forms
• Post buying leads
• Tools to manage CRM and trade info

• Close to 4.2 mm storefronts of suppliers
• Instant messaging
• Trade negotiation
• Over 200 online community forums for user groups

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Alibaba.com B2B Marketplaces Two Major
Components of Alibaba.com
2. Community
1. Marketplace
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Alibaba.com B2B Marketplaces International
Marketplace
Key features on product listing page
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Global network at your fingertips
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A truly global network for importers and
exporters of mechandise, finished products,
component parts and raw materials
Manufacturers
Export
Alibaba e-marketplace
Global Buyers
Trading agents
Manufacturers
Import
Alibaba e-marketplace
Trading agents
Global Suppliers
Retail shops
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Alibaba.com B2B Marketplaces International
Marketplace
More than 8 million users have registered on
Alibaba international B2B marketplace. US, India,
Europe (excluding UK), China, UK and Canada are
the key countries that the users come from
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Alibaba.com B2B Marketplaces Key Operating
Metrics
of Registered Users
of Storefronts
000
MM
CAGR 64
CAGR 59
of Paying Members
000
CAGR 53
400

• 1 E-Commerce (Marketplace) Website
• 1 International Business Trade Website (Import
  and Export in China)

300
432
200
305.5
219.1
100
141.6
77.9
0
2004
2005
2006
2007
2008

• Note
• Company data as of Dec 31, 2008

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Complementary strength of Alibaba with TPOs and
trade associations/chambers
Combining the core strengths of
chambers/associations with the marketing reach of
an eMarketplace creates new opportunities for
members
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Practice Sharing Trade Association program in
Korea
Partner Korea International Trade Association
(KITA www. KITA.org) A major business
association in Korea with over 65,000
members Partnership Model KITA and Alibaba.com
jointly provide KITA member SMEs with a special
package which include Alibaba.com International
TrustPass membership and KITAs tradeKorea
e-portal. Each SME would be eligible to a
subsidy which could only be used against
subscribing value-added services to facilitate
their listing, such as Korean-to-English
translation services. Educational courses on
e-commerce and online marketing would also be
provided to participating companies for their
better utilization of the Internet and
Alibaba.com.
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Practice Sharing TPO program in Taiwan
Partner Taiwan External Trade Development
Council (TAITRA, www.taitra.org.tw) A
non-profit trade promotion organization in Taiwan
which is jointly sponsored by the Taiwan
government, industry associations, and several
commercial organizations Partnership Model
Alibaba formed partnership with Taiwan Trade
Association, and provide for Taiwan SMEs a
bundled package which includes membership of both
Alibaba.com Gold Supplier and TAITRAs Taiwan
trade e-Portal. Those who joined the bundled
membership would get a NT10,000 discount off the
original total price of the two memberships.
Alibaba and TAITRA also jointly host road shows
and seminars to help SMEs breakthrough in the
downturn of intl trade situation.
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Practice Sharing Government support program in
Turkey
Partner IHRACATI GELISTIRME ETÜD MERKEZI
(IGEME) IGEME is the government run Export
Promotion Center for Turkey (http//www.igeme.org.
tr/indexe.cfm - in Turkish) Partnership
Model IGEME approved Alibaba on a list of B2B
marketplaces that are all qualified for
subsidies. Provided you submit the necessary
paperwork, IGEME will reimburse you 50 of the
membership fee (up to an amount I think of
US3K). SMEs can apply for multiple memberships
from different websites until they reach the cap.
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Practice Sharing Government subsidy program in
Chile
Partner Country of Chile Partnership
Model The program with the Chambers of Commerce
of Santiago in CHILE is a 3-way deal to be
complete by mid-June.  The Chambers of Commerce
will work with the Yellow Pages of Chile to
compile and provide Alibaba.com with the database
of Chilean products. The Chamber of Commerce
provides excellent data control and legitimacy in
the SME field, and already has the dataset of
companies in Chile with product references. The
Yellow Pages Company will provide support through
their massive outreach program to encourage the
integration of additional products to the
Chambers Database by SMEs.  Overall about 30,000
companies and 120,000 products are expected to be
presented within the program.
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Practice Sharing Government subsidy program in
Washington, US
Partner State of Washington, United
States Partnership Model Individual States in
the US have created economic development
organizations to promote direct investment as
well as companies within the State itself. The
logic is simple and practical the more revenue
made by companies within the state, the more tax
revenue these companies will be able to
generate. The State of Washington is aware of
their states value as a brand, and the need to
support as well as develop this value to promote
commercial activities, which is what the State
Your Product program hopes to accomplish. Alibaba.
com provides the State of Washington an
opportunity to promote their companies via the
Transfer Express product integration process to
help them bolster the impact of Washington State
companies in the global marketplace.
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Practice Sharing The World Chambers Network
Partner As part of the ICC, the WCN portal
officially links the virtual online commerce
space to the dynamic and only truly global
physical business network of over 14,000
registered Chambers of Commerce and Industry
(CCI) that in turn represent over 40 million
member businesses worldwide.  Partnership
Model Alibaba and the WCN today announced an
MOU to cooperate on a number of activities and
projects including but not limited to the
promotion of WCNs members on a global basis on
the Alibaba marketplace, exchanging relevant
trade information between the two parties and
explore the possibility of increasing the level
of trust within the communities by exploring
collaboration with Chamber Trust for WCN and
Trustpass for Alibaba.com
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Thank you!brian_at_alibaba-inc.com