A panel of e-commerce experts has confirmed that increasing online trade by SMEs could boost their wider social impact, as well as their profits.
On a webinar hosted by the Institute of Export & International Trade (IOE&IT) yesterday (20 March) as part of E-Commerce Week, Josh McWilliams, the head of UK exports at eBay, said online trade can lead to more jobs and therefore more social value.
“The social value of e-commerce can be split into financial and non-financial aspects,” he said. “On the non-financial side, at eBay we prioritise a lot around the circular economy – products like refurbished tech and pre-loved fashion – and we do a lot around charity, making it easier to offer charitable donations.
“On the financial sale, the more a seller sells, it translates into more jobs, more financial, economic and also social value.”
Value of beauty
Renee Parker, an advisory board member for the British Beauty Council, agreed, saying that more sales can lead to a “greater impact on people”.
“Beauty is an interesting industry because all of us use beauty and personal care products,” she said.
“When done right, these products support our mental health, our hygiene and positive self-reflection.”
She noted that 28% of revenues in the sector come from online channels and that the industry has a GDP multiplier of two – meaning that “for every £1m it generates in spending, it supports another £1m in contributions elsewhere in the economy. It’s got a powerful network effect.”
Citing the British Beauty Council’s recent ‘Value of Beauty’ report, Parker added that the sector employs over a half a million people in the UK, representing one in every 50 jobs.
“We over-index in entrepreneurs, micro-business and SMEs. That’s often people who are working flexibly, with over 40% of those employed in the industry working part-time.
“That represents a lot of women, people returning to work, people at different stages in their careers, and those supporting families and communities.”
Brexit impact
Parker said the value of beauty exports was £4.5bn in 2021 – some 1.4% of total UK exports – but that brands, including many SMEs, have “struggled to bring that number back up post-Brexit”.
McWilliams agreed that Brexit is “still impacting selling internationally” online.
He mentioned a programme at eBay through which the platform manages the export process for sellers to make it “as straightforward and hassle-free as a domestic sale”.
“We manage the customs forms, the category eligibility, the international shipping leg and if there’s any issues with the products,” he said.
This solution helps sellers to “unlock that international opportunity”, particularly those who “don’t have the skillset or time to focus on international complexity”.
Consumer safety
Karen Holden, a trade strategy and projects specialist at IOE&IT, said that e-commerce has an inherent social value because it gives consumers “freedom of choice” and the chance to “shop when they want to, how they want to and also cost-effectively”.
However, she said that most shoppers also seek “safety” in the online marketplace. Michael Kearney, the head of business engagement at the Office for Product Safety and Standards (OPSS), said that ensuring this safe environment was a “prime concern” for government.
“As a regulator, our prime concern is the availability of unsafe, non-compliant products in the marketplace.
“Compliance is not optional. It’s down to businesses to get this right and we take action against businesses that make unsafe products available”.
He echoed the comments of Kevin Hollinrake, the minister for enterprise, markets and small business, who said he wants “consumers to be as safe online as they are when they shop in a bricks and mortar establishment on the High Street.”
“We’re all about protecting people and places from product-related harm.
“But we also sit within the Department for Business and Trade, which has a huge focus on supporting businesses to grow, invest and trade domestically and internationally. We’re keen to see that businesses exploit the opportunities that come with e-commerce.”
E-Commerce Trade Commission
The webinar part of E-Commerce Week – a new campaign from the E-Commerce Trade Commission designed to encourage more SMEs to trade internationally online.
The Commission’s mission is driven, in part, by a report from the Social Market Foundation in 2022 that found that getting 70,000 non-exporting SMEs to sell online, using e-commerce, could boost the UK economy by £9.3bn.
Holden, however, added that the Commission also puts a “very high emphasis on improving the social impact for users of e-commerce – both business and consumers”.
“Trade brings people closer together, providing lower costs for products from all over the world that you wouldn’t have access to without the opportunities that e-commerce platforms bring,” she said.
“E-commerce is of great importance for marginalised people in our communities – for example, people with mobility restrictions that can’t physically get to bricks and mortar stores.
“It also allows people with different working patterns to be able to trade and buy products in their own time when they need to.”
You can read more about the E-Commerce Trade Commission here and follow it on social media for updates on E-Commerce Week, including X (formerly Twitter) and LinkedIn.