Business plan for Beeskit IT services, an online solutions platform for MSMEs / Don Gerald N. Nombre

Date : May 2019
Number of Pages : 42 leaves
Adviser : Prof. Beth Francisco

Executive Summary

To argue that we are living in a digital age may already be several years obsolete, as our economy moves at a faster rate than ever before. The global influence of the internet, and the speed of flow of information that goes along with it, has long been a game changer for global and local businesses alike. 

It is then expected that the E-commerce landscape has seen a steady rise over the past four years, and is projected to grow further by 2021. From 7.4% market share on 2015, the E-commerce market is projected to contribute 17.5% of the total global retail sales. In US alone, it amounts to $446.8 million worth of retail sales on 2017, and is projected to rise to $735.4 million by 2023.

In a local scale, the Philippines has around 924,000 established businesses, 99.56% of which are composed of Micro, Small and Medium enterprises, or MSMEs (PSA 2017). Combined, the MSMEs sector alone provides a total sale worth of Php751,943 million, which equates to 35.7% share of the market (DTI, 2017).

A survey conducted by We Are Social found that Filipinos spend an average of 6.3 hours every day using the internet (We Are Social 2015). In a study conducted by VISA, nine (9) out of ten (10) Filipino consumers go online to shop at least once a month (DTI E-Commerce Roadmap 2016). Further studies show that between 70-80% of people research a company online before visiting the small business or making a purchase with them (Blue Corona, 2018).

As for small businesses trying to meet this demand, 66% of small business owner agrees that finding new customers is a top concern (Hubspot, 2018). Despite these numbers, approximately only 50% of MSMEs have invested in a website. 30% of whom without a website cites cost as the main factor (Adobe 2018). Several companies have in fact tried to solve the cost problem. Cheap solutions are being offered via cloud, with profit-in-scale as its business model. Companies such as Amazon Web Services and Digital Ocean offer cloud infrastructure services for costs as low as $5 per month.

With such low cost solutions available to MSMEs, why then, is there still a large gap for adaptation of online solutions? The researcher argues that cost is just half of the problem. In an online survey of 30 business owner respondents conducted by the researcher, when asked why they don't have their own website, 46% indicated that their key reservation is their limited know-how.

This paper aims to build a business plan for an online solution platform to bridge the gap between local and consumers and local MSMEs and address these two key pain points : cost and complexity.