German SMEs still make very little use of digital sales channels

Frankfurt am Main (ots) -

- KfW study: only 16% of SMEs rely on e-commerce
- Share in total turnover is still low
- Retailers, wholesalers and young businesses are pioneers

E-commerce, the selling of products using online channels, still
plays only a minor role in the German SME sector. A representative
study conducted by KfW Research on the basis of the KfW SME Panel
shows that small and medium-sized enterprises currently generate only
EUR 153 billion a year through digital channels - a mere 4% of the
SME sector's overall turnover. Only a small portion of SMEs, 16%,
currently auses the opportunity to deliver their products or services
to their customers online. In other words, eight in ten SMEs are not
yet generating any turnover through digital channels. But KfW's
analysis also shows that the digital transformation is slowly but
surely reaching SMEs. The newer a company is in the market and the
younger its owner is, the more important e-commerce is for its
turnover.

According to estimates by KfW Research, transactions with
businesses (B2B business) currently make up the biggest share of
digital turnover of SMEs by far, at EUR 144 billion. Component
supplies in the engineering and motor vehicle industry play the
biggest role here. In retail consumer business, all German SMEs
combined generate only EUR 9 billion through e-commerce. For
comparison, Amazon, the biggest online retailer, sells products worth
around EUR 8 billion annually in Germany alone.

Trading companies are the digitisation pioneers among SMEs, which
is hardly surprising. One in three retailers and wholesalers conduct
e-commerce - either in direct contact with the end consumer or as
another company's supplier. Their share of online turnover is the
highest, accounting for 25% of the SME sector's overall turnover. In
all other sectors the online sales channel is much less important.
Among the SME service providers, some 13% are active in e-commerce
and the turnover they achieve through this channel is 17%.

Even if the SME sector has not yet fully embraced e-commerce,
whether or not an enterprise uses this mode of trading makes a
significant difference for its performance. KfW's analysis revealed
that small and medium-sized enterprises with extensive e-commerce
activities are more optimistic about the future and have higher
turnover growth. Recently, the mean turnover growth rate of SMEs with
considerable online turnover (more than half) was as high as 15% -
almost four times that of businesses without e-commerce turnover
(4%). It also showed, however, that the strong competitive pressure
in online business is having an impact, narrowing companies' range
for setting prices and thereby adversely affecting their
profitability. According to the KfW survey, the average profit margin
of small and medium-sized enterprises with e-commerce is around 4%
while that of SMEs without e-commerce is 8% - twice as high.

"Across much of the SME sector, digital selling is still in its
infancy. But that also means small and medium-sized enterprises are
not yet making enough use of the opportunities e-commerce offers for
business", said Dr Jörg Zeuner, Chief Economist of KfW. "Even if not
every sector is equally suited for e-commerce, businesses on a broad
front face evolving customer needs. Both end consumers and business
customers increasingly demand permanent availability, fast delivery
times, real-time advice, individual offers, user-friendliness and
mobile capability. Digital sales channels could provide the answers
for many SMEs. In addition, turnover can be generated online that
would not have materialised through classic channels - for example by
tapping into new, digitally savvy customer groups or expanding the
sales area into new regions."

The current special analysis of the KfW SME Panel on the topic of
e-commerce is available at www.kfw.de/fokus (English version
forthcoming).

The figures refer to the year 2015 as these are the most
up-to-date representative data.

Contact:
KfW, Palmengartenstr. 5 - 9, 60325 Frankfurt
Kommunikation (KOM), Christine Volk,
Tel. +49 (0)69 7431 3867, Fax: +49 (0)69 7431 3266,
E-Mail: Christine.Volk@kfw.de, Internet: www.kfw.de

Original-Content von: KfW, übermittelt durch news aktuell