With about a hundred million population, the Philippines is already a big market at least in theory, but the theory stops short of reality, because of our lopsided reliance on imported

goods, many of which are smuggled. As the theory goes, our local producers could already prosper if only the domestic consumption is dominated by locally produced goods, but unfortunately that is not the case. In the retail level, many small retailers and shopkeepers would have been doing good business even at a small scale, but the window of opportunity also closed on them when the big malls came along, the latter selling goods that are probably imported also.

With a local market that is saturated with imported goods and a local distributing system that is dominated by the big malls, there seems to be no other way to go except towards the export markets, but the conventional way of selling abroad is easier said than done. That is so, because conventional exports would require big capital because of the large production volumes required. It would be fair to say that there could be a small number of local companies that are succeeding in exports, but that seems to be the exception rather than the rule, and that is why many of the small and medium enterprises are still left out of the equation. It seemed that there was no way out of this problem, until e-commerce came along as a viable option.

There are billions of people around the world who have access to e-commerce, and Facebook alone has over half a billion people. By comparison, Facebook is bigger than many countries in terms of population, and it is about five times bigger than the population of the Philippines. By design however, Facebook is a social networking site and is not really an e-commerce site, even if members could use it to advertise their products and services. There are four characteristics of an e-commerce site: (1) a shopping cart, (2) a payment system, (3) a delivery system and (4) an accounting system.

A virtual shopping cart in an e-commerce site functions like a physical shopping cart in a brick and mortar store. A customer selects items from a display “shelf” and drags (places) each item into a cart. A virtual payment system functions like a physical checkout counter, because this is where customers are billed for their purchases. A delivery system is usually a third party logistics provider, while an accounting system is just a database at the backend of the site. It is similar to the back office operation of a brick and mortar store. The bottom line is that a customer is billed, he pays, and he gets his goods and services.

Many experts say that if a merchant will not go into e-commerce, it will be as if he will not be doing any commerce at all, because it will eventually become the dominant means of doing business. In other words, if a merchant will not go into the online business, he might eventually go out of business. Of course, physical trading will not completely disappear in the same way that paper will not disappear even if paperless transactions will eventually become the norm. As a consolation perhaps, a good blend of online and offline transactions could be the one that will keep many businesses afloat.

Technically speaking, social networking sites are actually part of new media, and the reason why it is successful is because it has become a lucrative advertising medium. In this case, it could be said that old media will eventually weaken in terms of importance, and we could see this happening already as some printed editions of newspapers and magazines are closing down to give way to their Internet versions. Taken together, social networking sites and e-commerce sites are bound to take over the commercial world.

As of now, many Filipinos are already doing e-commerce in free sites such as
www.multiply.com. That is a good starting point, but eventually, the more experienced online merchants should move on to their own proprietary sites, so that they could have more control of their data and their intellectual property rights. They should eventually do that when they already have their own products and designs, beyond their own situation now wherein many of them are really just traders or retailers of products that they buy and sell, some of which could even be imported also.

I say that e-commerce is the last frontier for doing global business, because right now, it is hard to imagine that anything newer or better could still come after it. As I see it, what could just become better would be cheaper and faster ways of connecting to the Internet, perhaps also in easier and more secure ways. As it is, the Internet itself could evolve into a bigger and stronger network. In the United States, parallel Internet networks have already emerged, some going back to the original purposes of the internet, which are academic and scientific research.

Even if we have apparently missed the train in the industrial age, we still have a chance of making it in the Information Age, and in the probable next stage that some seers are already calling the Transformation Age. Hopefully, the opportunities in e-commerce will be open to more small Filipino producers and merchants, so that more people will be able to graduate from poverty, hopefully even graduating from the bounds of employment, towards becoming wealthy and independent global online entrepreneurs.

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